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Emerging Markets Aren't Really in Charge of Their Own Interest Rates Anymore

The Fed drives long-term interest rates across 12 emerging markets, according to a new Bank for International Settlements' working paper.
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Emerging Markets: Does the Rally Have Legs?

Emerging market central banks are shackled to their U.S. counterparts, with local long-term interest rates held hostage to the Federal Reserve and the monetary policies of other advanced economies.

That's the striking picture painted, in not so many words, by a new Bank for International Settlements (BIS) paper. The research throws into sharp relief how domestic monetary policy in a clutch of emerging markets has been rendered effectively impotent thanks to financial globalization.