Latest / Monetary Policy Explained with Fexingo: Central Banks, Money Supply, and Interest Rates
How Central Banks Use Their Balance Sheet as a Policy Tool
In this episode of Monetary Policy Explained with Fexingo, Lucas and Luna dig into the central bank balance sheet — not as an abstract concept, but as an active policy lever. They walk through how buying and selling assets, from government bonds to mortgage-backed securities, influences everything from long-term interest rates to financial conditions. Using the Federal Reserve's actions in 2020 and 2026 as anchors, they explain the difference between quantitative easing and quantitative tightening, the signal it sends to markets, and why the balance sheet is sometimes called the…
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