The Fed is easing monetary policy both through interest rates and quantitative easing. Quantitative easing was the strategy used by Japan earlier this decade to effectively push rates below zero, flooding the system with more liquidity than it needed. This helped spawn the carry trade and the credit bubble which ultimately crippled the global economy. Cue the scary “Twilight Zone” music…
Dealers will not like the sound of quantitative ease given its Japanese connotations and will likely keep the dollar under pressure.
