Less chance of “taper tantrum” in emerging markets – Dallas Fed paper
Emerging markets have larger dollar reserves to meet financing disruptions
Large developing economies are better positioned to weather a taper of Federal Reserve asset purchases than they were in in 2013, a new paper argues.
Emerging markets have enough foreign exchange reserves to adjust should dollar financing start flowing back to the US, J Scott Davis says in an article published by the Dallas Fed.
The original “taper tantrum” began in 2013, when Federal Reserve chair Ben Bernanke first hinted at reducing quantitative easing. This caused dollars to flow back to
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