Why does the Fed increase affect the global economy?

When we read the basic learning forex, often the expression "the Fed print" and how it turned into a negative market or positive. In this article, we will discuss why it is all about EDF things.


Federal Reserve is known simply as the Fed is the United States Central Bank and its main purpose is to provide the country with safer and more stable monetary and financial flexibility, making it control the economy. Monetizing the monetary policy of Fed's policy-makers to help keep on working, keep prices stable and keep interest rates at a level favorable to economic development, as well as overseeing and regulating banks for controls Safety and consumer protection. Now we have a good idea of ​​what the Fed and what they do, so that we can continue with our topic on the board, which is how the global food boost hurt the US economy.

As explained above, the Fed is the central bank for the United States, and all the stronger (s) decisions will be taken and followed, around the world with decision-makers and politicians and investors. The United States is known to have the largest economy and a large source of capital for many countries in both the emerging markets and emerging markets around the world. USD stock of the world and makes the movement of food is very important and precious in the world. In this sense, any modification by the Fed has the power to shake or thrill markets around the world, which has led to significant changes in global financial markets.

What happens when the Fed raises interest rates? Global markets will react immediately because US bonds are required to pay higher interest rates leading to stock market fluctuations. What witnessed a drop in foreign capital from emerging border markets and returned to the United States undoubtedly has a realistic impact on the financial condition of emerging markets.

The effect of the Federal Reserve for the global economy can not be underestimated because today it has advantages in the financial economy in the world.