FINANCIAL TIMES: In the latest sign of rising alarm in emerging markets over the Fed’s plan to “taper” financial asset purchases, [Indonesia Finance Minister] Chatib Basri told the Financial Times that the ongoing uncertainty over US monetary policy could become a further drag on economies like Brazil, India and Indonesia, which are becoming ever more important contributors to global growth.
Emerging markets from Indonesia to Brazil have suffered a sharp sell-off triggered by expectations that the Fed will soon begin to wind down a quantitative easing programme that has inflated the price of global assets, particularly in high-yielding, riskier emerging economies, and reduced their borrowing costs…
“I don’t think any country in the world has enough clear information about the plan for [US] quantitative easing,” said Mr Basri. “People are guessing that the Fed will do the tapering in September. But we’re not very sure. We don’t know about the mechanism or what will be the impact. Everyone’s guessing.”… (more)
