BIS paper finds US spillovers impact through long-term rates
Long-term rates may be more important than previously assumed
A working paper published by the Bank for International Settlements (BIS) has found US monetary policy spills into emerging Asia mainly through its effect on long-term interest rates.
Spillovers of US unconventional monetary policy to Asia: the role of long-term interest rates by Ken Miyajima, Madhusudan Mohanty and James Yetman uses a vector-autoregressive model to study the spillover effects of extremely accommodative monetary policy in the US.
The authors find spillovers occur mainly through
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