This time policymakers have not disappointed.

Ten days ago the European Central Bank (ECB) announced a programme to buy, without limit, government bonds of at-risk countries in the euro area. The creation of this theoretically infinite source of demand for government debt exceeded market expectations. Fears that the Single Currency might fail have eased and borrowing costs for governments in southern Europe have dropped sharply.

Last Thursday the US Federal Reserve announced its third programme of Quantitative Easing since 2008. By buying mortgage backed securities the Fed aims to drive down interest rates and push liquidity into the US economy. The spending is open-ended and will carry on until the US jobs market improves.

The unlimited nature of the interventions by the ECB and the Fed surprised and cheered financial markets. Since the ECB announcement, on September 6th, global equity markets have risen over 5%.

Financial markets like what has been announced but the hard economic data remain pretty downbeat. In recent weeks economists have continued to cut their European growth forecasts for 2013.

Much now hangs on whether the actions of the latest actions by the ECB and the Fed will boost activity.

The ECB's move reduces borrowing costs for governments and buys the euro area more time. But the need for deep change in the peripheral economies remains.

History shows that economies can achieve such change. Ireland has made significant headway in reducing costs and raising exports. But the pace of change elsewhere in Europe's periphery is slower and more erratic. These countries still face a long grind, shrinking public spending, reforming their economies and squeezing wages.

America is in a stronger position than the euro area. The US has benefited from a weaker dollar and the Fed's aggressive response to the financial crisis. US housing no longer looks expensive and the US seems to be ahead of Europe in strengthening its banks.

Investors also see US government debt as a safe haven from the troubles of the euro area. Yet America has fiscal challenges of its own. As a share of GDP its public sector deficit is as big as Spain's.

There is no consensus on how the US should cut its deficit. Without a new Congressional agreement a series of automatic tax rises and spending cuts are due to take effect next January. These measures could remove the equivalent of 5% of GDP from the economy and plunge the US into recession in 2013.

This represents a real risk both to the US and to the global economy. Last week's announcement of QE3 looks like an attempt to lend impetus to what has been a lacklustre and erratic US recovery ahead of the looming fiscal cliff.

The actions of the ECB and the Fed have buoyed equity markets. The real test is whether they are sufficient to boost confidence and persuade companies and consumers to spend.