InvestorQ : Is it true that global central banks are planning to infuse liquidity into the market and will that revive global markets?
Crowny Pinto made post

Is it true that global central banks are planning to infuse liquidity into the market and will that revive global markets?

Answer
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8 months ago


That appears to be the plan and some central banks like China have already started infusing liquidity. While the liquidity could give a boost to stock markets, it is doubtful if it could help GDP growth and an economic revival. In fact, Dutch banking major Rabobank has come with a contrarian view on the subject. Michael Every of Rabobank has categorically stated that irrespective of the amount of liquidity infused by central banks into the global economies, growth was unlikely to pick up. In fact, Michael Every has underlined that the need of the hour was structural fiscal reforms and putting more money in the hands of people would only inflate asset prices rather than drive growth. A big chunk of the slowdown was being caused, according to Every, by insufficiency of demand. That explains why the RBI is putting less accent on monetary measures and trying to put more effort on taxation and public spending to push growth to a higher plane.