Dutch paper: Fed guidance pushed up equity prices abroad
Largest impact in economies with lower sovereign ratings
The Federal Reserve's forward guidance on the federal funds rate led to higher equity prices in a number of advanced and emerging economies, according to a working paper published by The Netherlands Bank today.
In International spillovers from US forward guidance to equity markets, Richhild Moessner attempts to quantify the impact of the Fed's forward guidance on international equity markets.
The author finds that announcements about the future of the federal funds rate "led to higher equity
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