Publication:
The Coming U.S. Interest Rate Tightening Cycle: Smooth Sailing or Stormy Waters?
dc.contributor.author | Arteta, Carlos | |
dc.contributor.author | Kose, M. Ayhan | |
dc.contributor.author | Ohnsorge, Franziska | |
dc.contributor.author | Stocker, Marc | |
dc.date.accessioned | 2015-09-15T15:22:06Z | |
dc.date.available | 2015-09-15T15:22:06Z | |
dc.date.issued | 2015-09-15 | |
dc.description.abstract | Since the global financial crisis, the exceptionally accommodative monetary policy stance of the U.S. Federal Reserve (Fed) has helped support activity, bolstered asset valuations, and reduced risk premia. In addition, it has been instrumental in boosting capital flows to emerging and frontier market economies (EFEs). As the U.S. economy improves, the Fed is expected to start raising policy interest rates in the near term (an event widely referred to as “liftoff”) and thus commence a tightening cycle for the first time in nearly a decade. The mid-2013 “taper tantrum” episode is a painful reminder that even a long-anticipated change in Fed policies can surprise markets in its specifics, and lead to significant financial market volatility and disruptive movements in capital flows to EFEs. Recent debates have focused on the potential impact of the liftoff on EFEs, but there are also significant risks associated with the pace of subsequent rate increases, which is currently expected to be very gradual, but could accelerate at a time when EFE policy buffers are eroding. This Policy Research Note presents a comprehensive analysis of the changes in global conditions since the taper tantrum, risks of disruptions during the upcoming Fed tightening cycle, potential implications for EFEs, and policy options. | en |
dc.identifier.uri | http://hdl.handle.net/10986/22629 | |
dc.language.iso | en_US | |
dc.publisher | World Bank, Washington, DC | |
dc.relation.ispartofseries | Policy Research Note; | |
dc.rights | CC BY 3.0 IGO | |
dc.rights.holder | World Bank | |
dc.rights.uri | http://creativecommons.org/licenses/by/3.0/igo | |
dc.subject | long-term yields | |
dc.subject | growth prospects | |
dc.subject | economic fundamentals | |
dc.subject | Dollar strength | |
dc.subject | interest rates | |
dc.subject | business cycle | |
dc.subject | monetary policy | |
dc.subject | macroprudential policy | |
dc.subject | international policy coordination | |
dc.subject | tightening cycle | |
dc.title | The Coming U.S. Interest Rate Tightening Cycle | en |
dc.title.subtitle | Smooth Sailing or Stormy Waters? | en |
dc.type | Working Paper | en |
dc.type | Document de travail | fr |
dc.type | Documento de trabajo | es |
dspace.entity.type | Publication | |
okr.date.disclosure | 2015-09-15 | |
okr.doctype | Publications & Research | |
okr.doctype | Publications & Research :: Working Paper | |
okr.externalurl | http://www.worldbank.org/en/research/brief/policy-research-note-no2-the-coming-us-interest-rate-tightening-cycle-smooth-sailing-or-stormy-waters | |
okr.globalpractice | Macroeconomics and Fiscal Management | |
okr.globalpractice | Finance and Markets | |
okr.identifier.report | 100014 | |
okr.language.supported | en | |
okr.topic | Finance and Financial Sector Development :: Currencies and Exchange Rates | |
okr.topic | Macroeconomics and Economic Growth :: Business Cycles and Stabilization Policies | |
okr.topic | Macroeconomics and Economic Growth :: Economic Forecasting | |
okr.topic | Macroeconomics and Economic Growth :: Economic Growth | |
okr.topic | Macroeconomics and Economic Growth :: Fiscal & Monetary Policy | |
okr.topic | Macroeconomics and Economic Growth :: Inflation | |
okr.unit | Office of the Chief Economist, Development Economics Vice Presidency (DECVP) | |
relation.isAuthorOfPublication | ac9fefe8-9d4d-555d-bb68-f056fd7a3790 | |
relation.isAuthorOfPublication | 5807995a-9e0a-5d56-b622-d4d19e723613 |