Overlooked global factors have major impact on long-term interest rates, IMF paper says

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More than 60% of variation in long-term interest rates can be explained by an aggregation of countries' fiscal and monetary policy stances, according to a recent International Monetary Fund research paper.

In contrast to studies on the effects of fiscal policy on interest rates that do not account for global factors, Salvatore Dell'Erba and Sergio Sola's Does Fiscal Policy Affect Interest Rates? Evidence From A Factor-Augmented Panel found that the importance of domestic variables in explaining

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