Following the 2008 global financial crisis, the Bank of England, alongside other major central banks, undertook unprecedented quantitative easing (QE) programmes, vastly expanding the monetary base. Despite predictions from monetarist economists that this expansion would trigger rapid inflation, consumer price inflation in the UK remained historically low until global supply shocks occurred in 2021/22.
Assess whether an expansion of the monetary base through central bank asset purchases always leads to high inflation in an economy.
