The United States began their programme of quantitative easing (QE) late in 2008 as a response to the Global Financial Crisis (GFC). Since that time, the US Federal Reserve has purchased $1.9 trillion of assets, keeping their financial markets afloat and lowering the US exchange rate. A lower exchange rate helps exporters.
I asked the Parliamentary Library to prepare statistics on the performance of the manufacturing sector in the wake of the GFC and QE. The results are mostly positive.
The GFC hit the US manufacturing sector hardest in 2009; exports contracted and hundreds of thousands of jobs were shed in this sector. But from 2010 onwards, manufacturing has turned around creating an average of 18,000 new jobs each month.
Source: Federal Reserve Bank of St Louis, Real exports of goods & services.
Real exports volumes of manufactured goods are up and on a much steeper growth path than historically, although it is now slowing from double digit growth in 2010 (14.4%) to a more modest 4.2% growth rate in 2012.
Over this time period, inflation has remained subdued despite the massive credit easing. Since August 2008, inflation in the USA has been 5.2%, which equates to an average annual inflation rate of just under 1.3%.