IMF Working Papers

The Effects of U.S. Unconventional Monetary Policy on Asia Frontier Developing Economies

By Sohrab Rafiq

January 23, 2015

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Sohrab Rafiq. The Effects of U.S. Unconventional Monetary Policy on Asia Frontier Developing Economies, (USA: International Monetary Fund, 2015) accessed July 17, 2025
Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper explores the effect of U.S. unconventional monetary policy (QE2) on a group of frontier developing economies (FDEs) in Asia. This paper finds that spillovers emanating from the U.S. on FDEs in Asia have been small. The relative insulation of emerging Asia from the global financial cycle can likely be attributed to the presence of managed capital accounts coupled with shallow financial markets. Should U.S. monetary policy begin to normalize the direct first-round impact on developing Asia is likely to be small.

Subject: Balance of payments, Capital flows, Current account balance, Financial services, Monetary policy, Short term interest rates, Unconventional monetary policies, Yield curve

Keywords: Asia and Pacific, Asia FDE block, Capital flows, Credit, Current account balance, Demand shock, Expectations-interest rate model, FDE Asia, Fed funds rate, Global, Interest rate expectation, Liquidity, Monetary policy in the U.S., Monetary policy independence, Monetary policy innovation, Monetary policy shock, Monetary policy spillover, Private sector interest rate expectation, Short term interest rates, Unconventional monetary policies, Unconventional monetary policy, WP, Yield curve

Publication Details

  • Pages:

    30

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 2015/018

  • Stock No:

    WPIEA2015018

  • ISBN:

    9781498334037

  • ISSN:

    1018-5941

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