The shift to QE in the UK may be seen as a policy move of the last resort, resulting from the exhaustion of conventional policy options, most notably the drop in short-term interest rates to near zero. QE's main aim, as made clear in Bank of England commentary, is to prevent inflation dropping significantly below the current 2% target - a risk that looked very considerable in the early months of 2009 as the real economy languished in a deep recession, asset prices were dropping sharply and the money supply growth was decelerating rapidly.
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