Arab Today, arab today lagarde warns emerging economies to prepare for us rate rise
Last Updated : GMT 21:46:51
Arab Today, arab today
Arab Today, arab today

Lagarde warns emerging economies to prepare for US rate rise

Arab Today, arab today

Arab Today, arab today Lagarde warns emerging economies to prepare for US rate rise

France-India Solar Direct Punjab Solar Park project
Mumbai - AFP

Emerging markets must prepare for the impact of US interest rate rises, whose timing could surprise markets, International Monetary Fund chief Christine Lagarde warned in India on Tuesday.
Speaking alongside India's central bank governor Raghuram Rajan, Lagarde said the so-called "taper tantrum" that hit emerging economies hard in 2013 could be repeated.
The US Federal Reserve caused panic in 2013 when it first signalled a reduction in its multi-billion dollar asset purchases to stimulate the economy.
India and other emerging economies were slammed as investors pulled out of their markets, in what came to be termed a "taper tantrum", amid speculation about the winding down of the stimulus programme that had rallied emerging markets.
"The danger is that vulnerabilities that build up during a period of very accommodative monetary policy can unwind suddenly when such policy is reversed, creating substantial market volatility," Lagarde said in prepared remarks in Mumbai at the end of a two-day visit to India.
"We already got a taste of it during the taper tantrum episode in May and June of 2013, when most emerging market economies suffered indiscriminate capital outflows.
"I am afraid this may not be a one-off episode. This is so, because the timing of interest rate lift-off and the pace of subsequent rate increases can still surprise markets.
"Emerging markets need to prepare in advance to deal with this uncertainty."
Lagarde said developed economies could help avoid future volatility with "clear and effective communication of policy intentions".
"We are perhaps approaching the point where, for the first time since 2006, the United States will raise short-term interest rates later this year, as the first country to start the process of normalising its monetary policy," she said.
"Even if this process is well managed, the likely volatility in financial markets could give rise to potential stability risks."
Emerging economies could prepare for future swings including through higher GDP growth, stronger external current account positions and lower inflation.
Central banks must also be ready to act, with aggressive and temporary liquidity support and targeted foreign exchange interventions, she advised.
She praised Rajan, a former IMF chief economist, and the Indian government for their economic reform efforts which should be pursued "with the utmost speed".
Lagarde met Prime Minister Narendra Modi on Monday as part of her visit to India, which she praised as a bright spot in the otherwise gloom-ridden global economy.

 

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today lagarde warns emerging economies to prepare for us rate rise Arab Today, arab today lagarde warns emerging economies to prepare for us rate rise

 



Arab Today, arab today

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today lagarde warns emerging economies to prepare for us rate rise Arab Today, arab today lagarde warns emerging economies to prepare for us rate rise

 



Arab Today, arab today France defies terrorism through tourism

GMT 15:18 2017 Saturday ,20 May

France defies terrorism through tourism
Arab Today, arab today Zainab Fadel Oglu designs “Shakerin” mosque

GMT 12:13 2017 Thursday ,11 May

Zainab Fadel Oglu designs “Shakerin” mosque
Arab Today, arab today Seeks to move past rift with Israel

GMT 08:00 2017 Monday ,08 May

Seeks to move past rift with Israel
View News in Arabic - Business: اقتصاد دولي
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Mozambique's gas boom dream under threat

GMT 16:29 2017 Monday ,08 May

Mozambique's gas boom dream under threat
Arab Today, arab today Prepares to give stargazers an eyeful

GMT 13:38 2017 Monday ,06 March

Prepares to give stargazers an eyeful
Arab Today, arab today Jaguar displays XF Sportbrake line

GMT 14:36 2017 Monday ,08 May

Jaguar displays XF Sportbrake line
Arab Today, arab today BMW sees forecasts in reach

GMT 09:04 2017 Thursday ,04 May

BMW sees forecasts in reach
Arab Today, arab today Climate science: Bad news gets worse

GMT 08:48 2017 Saturday ,06 May

Climate science: Bad news gets worse
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday