Economics
Turkey Just a Test Case as Quantitative Tightening Era Nears
- Impact of Fed, ECB balance-sheet tightening expected in 2019
- Financial crisis is more likely during Fed rate-hike cycles
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Turkey is just a drill.
A push by major central banks to reverse crisis-era policies is primed to accelerate into 2019 amid plans for higher interest rates and smaller balance sheets. So-called quantitative tightening then risks sucking dollars and euros from nations whose governments and companies binged on cheap debt without improving the fundamentals of their economies.