Filter by Categories
Accounting
Banking

Finance




Taper


A gradual scale back of bond purchases by the U.S. Federal Reserve (the Fed). Usually, the Fed buys bonds in the open market in order to keep interest rates low. Bond purchasing is mainly pursued by the Fed as a stimulus targeting the broader economy. The degree of tapering gives an indication to the performance of the broader economy. A sharp taper, which implies large cuts in bond purchases, would pull down the U.S. market and other global markets and send bond yields “through the roof”. A gentle tapering would suggest economy is flat or not doing very badly. No tapering, or delayed tapering, is indicative of the central bank’s discomfort with the economic performance for the time being. However, it means the market will currently follow, or keep, a sentiment bullish course.



ABC
Finance, as a field of knowledge, is substantially wide-ranging and virtually encompasses everything in the realm of corporate finance, financial management, ...
Watch on Youtube
Remember to read our privacy policy before submission of your comments or any suggestions. Please keep comments relevant, respectful, and as much concise as possible. By commenting you are required to follow our community guidelines.

Comments


    Leave Your Comment

    Your email address will not be published.*