Low Interest Rate Policies of US, and Europe Help Emerging Markets
Low Interest Rate Policies of US, and Europe Help Emerging Markets
It is with recent “Currency War” arguments, as emerging-market countries such as Brazil blame low-rate policies of the US and others for destabilizing their economies, analyst Marc Chandler recently wrote.
Brazilian Finance Minister Guido Mantega is among those leading the charge, contending the near-zero rates in global superpowers have “sparked powerful forces that destabilize emerging market economies through capital flows, driving their currencies sharply higher,” Mr. Chandler wrote recently on his “Marc to Market” blog.
But currency wars “seem to be more in the realm of rhetoric than politics,” Mr. Chandler said. Even if there are costs for developing countries from the easy monetary policy of advanced economies, there are also benefits, he said. Low rates are meant to help boost in aggregate demand in the US and Europe, which would stimulate trade as well as underpin growth in emerging markets.
“Aggressive monetary policy in the face of a weak domestic economy is not the equivalent of a currency war,” Mr. Chandler said. Mr. Chandler is the Global Head of Currency Strategy at Brown Brothers Harriman in New York.
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Heffernan Capital Management
Linda Johnson,
Business Development Director – Private Client Group,
Sales@Heffcap.com
Singapore
3 Raffles Place #07-01
Bharat Building Singapore 048617
Tel: +65 6329 6408
Fax: +65 6329 9699
Paul A. Ebeling, Jnr.
Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster’s Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.
Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.
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