Chile, Colombia, Peru central banks ready for Fed taper - Peru
LIMA Dec 5 (Reuters) - The central banks of Chile, Colombia, and Peru are ready to face an "abrupt change" in global economic conditions following the expected withdrawal of monetary stimulus by the U.S. Federal Reserve, Peru's central bank said.
The three countries had adopted monetary and fiscal policies that had strengthened their economies and would help shield them if the Fed decides to start pulling back on its asset purchases, the Peruvian central bank said in a report on Thursday.
"The accumulation of international reserves, a greater exchange rate flexibility, a better fiscal position and better handling of public debt" are the common aspects that could help the three Andean nations - which have among the most open economies in the region - withstand an eventual exit of capital from emerging markets, the bank said.
Fed officials have been buying $85 billion in bonds each month to keep borrowing costs low. Most economists do not expect them to taper their purchases until March, although some speculate they could move at their next meeting on Dec. 17-18.
Such a move would likely lead to capital withdrawal from emerging markets, as investors bet on higher U.S. interest rates.
(Reporting by Teresa Cespedes, Writing by Rosalba O'Brien; editing by Andrew Hay)
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