External effects of US monetary policy
M. Yu. Golovnin ()
Outlines of global transformations: politics, economics, law, 2018
The article focuses on theÂ changes in US monetary policy since theÂ beginningÂ of the 21st century and reveals theÂ impact of this policyÂ on the national economiesÂ of other countries, especially emergingÂ markets. The US monetary policy influencedÂ the emergingÂ markets both through the realÂ and financial channels. Through theÂ latter,Â the main impact was on the Treasury billsÂ rates and on theÂ exchange rates. At the sameÂ time, the influence on differentÂ countries variedÂ in different periods. For example, interestÂ rates inÂ Thailand, Mexico and PakistanÂ before the global economic andÂ financial crisisÂ in general followed the cycle of US monetaryÂ policy.Â The â€œquantitative easingâ€ policy,Â the statements and the follow-upÂ actions toÂ abolish it, have influenced cross-border capitalÂ flows toÂ emerging markets. A numberÂ of countries, including Russia,Â experiencedÂ the impact of US monetary policy throughÂ the dynamicsÂ of oil prices. Emerging marketsÂ face restrictions on their monetaryÂ policyÂ from the US monetary policy, but in practiceÂ they seek toÂ circumvent them through exchangeÂ rate regulation, restrictions onÂ crossborderÂ capital flows and the pursuit of an independentÂ monetary policy, not following theÂ Â cycles of interest rate changes in the US.
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Persistent link: https://EconPapers.repec.org/RePEc:ccs:journl:y:2018:id:330
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