Today we are pleased to present a guest contribution written by Serkan Arslanalp, senior economist at the IMF. This post is based on the paper by the same title, coauthored with Wei Liao, Shi Piao, and Dulani Seneviratne (all of the IMF).
Category Archives: financial markets
US Financial Conditions and Emerging Market Stress: The Outlook
From NYT:
…around the globe, the surge in the dollar is provoking financial jitters.
Emerging market countries and corporations that have been binging on cheap dollar debt for more than a decade now face a spike in servicing costs and elevated debt burdens.
Raise the Yuan! Implications for the Treasury Spread
Some back-of-the-envelope calculations: If we get what President Elect Trump says he wants — no depreciation of the yuan — what happens to the Treasury 10 year-3 month spread?
Factors in low real interest rates
The real return on long-term government bonds has dropped steadily over the last 30 years, falling from values around 4% to something closer to zero or even negative for many countries today. What accounts for this remarkable development, and what are the prospects for this situation to continue?
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Guest Contribution: “Shadow Rates, Forward Guidance, and Unconventional Monetary Policy”
Today we are pleased to present a guest contribution by Yi Zhang, Ph.D. candidate at the University of Wisconsin-Madison. This post draws upon this paper.
Rising interest rates and the term premium
Last week I puzzled over the response of financial markets to the U.S. election. Since the election, the S&P500 is now up 3%, the dollar is up 4.6% against the euro, and most remarkable of all, the 10-year Treasury rate has gone up 50 basis points. Here I offer some further thoughts on the last development.
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Mr. Trump and the markets
I was astounded not only by the outcome of the U.S. presidential election but also by the response of financial markets.
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Guest Contribution: “Is the Renminbi a Safe Haven?”
Today, we are fortunate to present a guest contribution written by Rasmus Fatum, at the University of Alberta. This post is based upon the Dallas Fed working paper by the same title.
Commodities, International Finance, and Real Exchange Rates
Those are the topics covered tomorrow (Friday, 10/14) at the 5th annual West Coast Workshop in International Finance 2016, taking place at Santa Clara University. As usual, these look like a set of fascinating papers, and a must-see for those interested in international finance/open economy macro (A post discussing last year’s conference proceedings is here).
Re-Writing the (International) Textbook: Interest Parity Conditions
Literally.