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WASHINGTON / TOKYO. The Federal Reserve's chairman, Ben S. Bernanke rejected the argument that the measures taken to corner the U.S. central bank (the U.S.) will have a negative impact emerging markets.
In a speech delivered on Sunday (14/10) yesterday, Bernanke explicitly said he did not agree with the criticism that is leveled, its efforts to stimulate the economy by holding interest rates at low levels close to 0% tails of soaring inflation in developing countries. In this case, the cause of inflation is the destabilization of foreign investment to developing countries.
"I do not destroy the global economy," he said. Instead, the Fed's policy actually benefit the global economy because of successfully creating a stronger market for goods from developing countries.
Bernanke Speech delivered when he attended a conference sponsored by the Bank of Japan (BoJ) and the International Monetary Fund (IMF) in Tokyo.
Keep in mind, the new policy of the Fed is doing with the stimulus-based purchase housing bonds worth U.S. $ 40 billion per month. Another purpose of this purchase was to keep interest rates remain low and are expected to drive growth in the housing market.
The Fed also extended the current interest rate projections of the original can be changed in 2014 to last until 2015, while the U.S. economy began to grow at a higher speed.
Previously, officials outside the U.S. have been critical of the Fed's policy. They looked, low U.S. interest rates will benefit the U.S. trade balance because the dollar is weakened. If the U.S. dollar is weak, American-made goods cheaper for other countries.
"I do not agree on the assessment of the interest rate policy of the Fed and other developed countries dictate the flow of global capital," he said.
He also pointed out, there are some emerging market countries that have managed to keep their exchange rates stable by way of intervention. However, without naming specific countries, according to Bernanke, there are also countries around the balance of trade by deliberately weakening its currency and it is the U.S. which is the act of cheating.
Even so, everyone knows, the economic giant that keep the trade balance by deliberately weakening its currency is China. Bernanke Speech could have also led to the cold war currency. In particular the U.S. dollar versus the yuan.
Expected, the Fed will announce a major step back further on 23-24 October. The majority of analysts, the Fed has not determined the exact time because still waiting and monitoring the results of the policy, which was launched last September.
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