A slow but steady removal of monetary stimulus in the US over the next few years is likely to have important implications for a wide variety of financial market instruments. It should buoy the dollar, put gradual upward pressure on the yields of government bonds, and continue to sap demand for many “risky” assets that previously benefited from the Fed’s quantitative easing. That being said, we do not anticipate a re-run of the upheaval that was triggered by the publication of the minutes of May’s FOMC meeting, as investors now appear to have acclimatised to the prospect of less accommodative monetary conditions and the US central bank is likely to tread cautiously.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services