Quantitative Easing (QE) is a monetary policy used by central banks to stimulate the economy when traditional methods, like lowering interest rates, are ineffective. In QE, a central bank, such as the Federal Reserve, purchases financial assets, like government bonds, to increase the money supply and encourage lending and investment. By buying these assets, the central bank injects money into the economy, which can lower interest rates and make borrowing cheaper. This aims to boost spending by businesses and consumers, ultimately supporting economic growth and helping to achieve goals like full employment and stable prices.