Posted by WARREN MOSLER on October 27th, 2009
This would help support exports. (But my first choice would instead be funding an $8/hr job for anyone willing and able to work and a tax cut to sustain domestic demand and optimize real terms of trade.)
Carney Says Intervention Needs Policy to Back It Up to Work
Oct. 27 (Bloomberg) — Bank of Canada Governor Mark Carney said today that central banks that try to affect the level of their currencies through market actions need to back the transactions with monetary policy to be effective.
Speaking to lawmakers, Carney said the bank could use tools, including quantitative easing, to implement policy with
the bankâ€™s key interest rate as low as it can go.
Selling your own currency is the back up to your other, export oriented policy.
There is no limit to the amount of your own currency you can sell into a bid at that level.
The (operational) limit is how much the rest of world wants to buy at your selling price.
Quantitative easing has nothing to do with this.