Five key questions on QE in the euro-zone

The European Central Bank (ECB) appears finally to be seriously considering the option of implementing quantitative easing (QE). While we have long argued that QE in the euro-zone was a more likely option than commonly thought, there are many uncertainties over its possible form, size and effectiveness. This Update briefly addresses some of the key questions and concludes that the policy is unlikely to transform the economic outlook or eradicate the risk of deflation.