Global Interest Rate Environment with Emphasis on Quantitative Easing Implications

Emmanuel Teitey

doi:doi:10.11648/j.ajbio.20170504.11

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Global Interest Rate Environment with Emphasis on Quantitative Easing Implications

Emmanuel Teitey

Published in American Journal of BioScience (Volume 5, Issue 4)

Received: 2 March 2017 Accepted: 24 March 2017 Published: 1 June 2017

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Abstract

Constructing global real interest rates at short and long maturities and reviews their evolution since 1980. It also traces the evolution of the cost of capital, It then analyzed key factors that could explained the observed pattern, shift in savings, changes in monetary and fiscal policy, shift in investment demand, changes in relative prices of investment, monetary policy and portfolio shifts between bonds and equity. It closes by considering how the main factors behind the decline in real interest rates might play out in the medium term. Real interest rates and the cost of capital are likely to rise moderately in the medium term from current level. Part of the reason is cyclical, the extremely low real interest rates of recent years reflects large negative output gaps in advanced economies. Indeed, the real interest rates might have declined even further in the absence of the zero lower bound on nominal interest rate.

Published in	American Journal of BioScience (Volume 5, Issue 4)
DOI	10.11648/j.ajbio.20170504.11
Page(s)	59-63
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Real, Interest, Nominal, Monetary, Fiscal

References

[1]	Bernanke, B., (2012).The Federal Reserve’s quantitative easing or large scale assets purchase program. www.thedaily economist.com/2012/_09_01 archive.html. Retrieved: October 28^th 2016.
[2]	Capistran, C., & Timmermann, A. (2009). Disagreement and biases in inflation expectation. Journal of Money, Credit and banking, (41)366-396.
[3]	Cerra,V., & Saxena, S. C. (2008).Growth dynamics: The myth of economic recovery, American Economic Review. 98(1)439-57.
[4]	Dovern, J., Fritsch, U., & Slacalek, J. (2009). Disagreement among Forecaster in G7 countries, ECB workingpaper1082.
[5]	Eggertsson, G. B., & Woodford, M. (2003). The zero bound on interest rates and optional monetary policy. Brooking Paper on Economic Activity. (1)139-211.
[6]	Harlina, S. J., Intan, R. E., Nasruddin, F., & Emi, N. O. (2011). The economic growth and how effectiveness is the stock market. International Business Journal, 24(6)24-25.
[7]	Lyonnet, V., & Werner, R. A. (2012). Lessons from the Bank of Ghana on quantitative easing and the accountability of the central bank in Japan. Working paper presented at the 15^th annual meeting of the annual international conference on macroeconomic analysis and international finance.
[8]	Reinharrt, C. M., & Rogoff, K. S., (2008). Is the U. S. subprime crisis so different? An international historical comparison. Americal Economic Review. 98 (2)339-44.
[9]	Voutsinas, Y., & Werner, R. A.,(2016).Bank runs, deposit instruments and Liquidity. Journal of Political Economy,(2) 26-35.
[10]	Zenith Bank (Ghana) Ltd. (2015a). Z-Business news, Monthly Bulletin, January (100), 2-3.

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Emmanuel Teitey. (2017). Global Interest Rate Environment with Emphasis on Quantitative Easing Implications. American Journal of BioScience, 5(4), 59-63. https://doi.org/10.11648/j.ajbio.20170504.11

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Emmanuel Teitey. Global Interest Rate Environment with Emphasis on Quantitative Easing Implications. Am. J. BioScience 2017, 5(4), 59-63. doi: 10.11648/j.ajbio.20170504.11

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AMA Style

Emmanuel Teitey. Global Interest Rate Environment with Emphasis on Quantitative Easing Implications. Am J BioScience. 2017;5(4):59-63. doi: 10.11648/j.ajbio.20170504.11

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@article{10.11648/j.ajbio.20170504.11,
  author = {Emmanuel Teitey},
  title = {Global Interest Rate Environment with Emphasis on Quantitative Easing Implications},
  journal = {American Journal of BioScience},
  volume = {5},
  number = {4},
  pages = {59-63},
  doi = {10.11648/j.ajbio.20170504.11},
  url = {https://doi.org/10.11648/j.ajbio.20170504.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajbio.20170504.11},
  abstract = {Constructing global real interest rates at short and long maturities and reviews their evolution since 1980. It also traces the evolution of the cost of capital, It then analyzed key factors that could explained the observed pattern, shift in savings, changes in monetary and fiscal policy, shift in investment demand, changes in relative prices of investment, monetary policy and portfolio shifts between bonds and equity. It closes by considering how the main factors behind the decline in real interest rates might play out in the medium term. Real interest rates and the cost of capital are likely to rise moderately in the medium term from current level. Part of the reason is cyclical, the extremely low real interest rates of recent years reflects large negative output gaps in advanced economies. Indeed, the real interest rates might have declined even further in the absence of the zero lower bound on nominal interest rate.},
 year = {2017}
}

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TY  - JOUR
T1  - Global Interest Rate Environment with Emphasis on Quantitative Easing Implications
AU  - Emmanuel Teitey
Y1  - 2017/06/01
PY  - 2017
N1  - https://doi.org/10.11648/j.ajbio.20170504.11
DO  - 10.11648/j.ajbio.20170504.11
T2  - American Journal of BioScience
JF  - American Journal of BioScience
JO  - American Journal of BioScience
SP  - 59
EP  - 63
PB  - Science Publishing Group
SN  - 2330-0167
UR  - https://doi.org/10.11648/j.ajbio.20170504.11
AB  - Constructing global real interest rates at short and long maturities and reviews their evolution since 1980. It also traces the evolution of the cost of capital, It then analyzed key factors that could explained the observed pattern, shift in savings, changes in monetary and fiscal policy, shift in investment demand, changes in relative prices of investment, monetary policy and portfolio shifts between bonds and equity. It closes by considering how the main factors behind the decline in real interest rates might play out in the medium term. Real interest rates and the cost of capital are likely to rise moderately in the medium term from current level. Part of the reason is cyclical, the extremely low real interest rates of recent years reflects large negative output gaps in advanced economies. Indeed, the real interest rates might have declined even further in the absence of the zero lower bound on nominal interest rate.
VL  - 5
IS  - 4
ER  -

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Author Information

Emmanuel Teitey

Research Department, Noble International Business /Doctoral School, Accra, Ghana

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APA Style

Emmanuel Teitey. (2017). Global Interest Rate Environment with Emphasis on Quantitative Easing Implications. American Journal of BioScience, 5(4), 59-63. https://doi.org/10.11648/j.ajbio.20170504.11

Copy | Download

ACS Style

Emmanuel Teitey. Global Interest Rate Environment with Emphasis on Quantitative Easing Implications. Am. J. BioScience 2017, 5(4), 59-63. doi: 10.11648/j.ajbio.20170504.11

Copy | Download

AMA Style

Emmanuel Teitey. Global Interest Rate Environment with Emphasis on Quantitative Easing Implications. Am J BioScience. 2017;5(4):59-63. doi: 10.11648/j.ajbio.20170504.11

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@article{10.11648/j.ajbio.20170504.11,
  author = {Emmanuel Teitey},
  title = {Global Interest Rate Environment with Emphasis on Quantitative Easing Implications},
  journal = {American Journal of BioScience},
  volume = {5},
  number = {4},
  pages = {59-63},
  doi = {10.11648/j.ajbio.20170504.11},
  url = {https://doi.org/10.11648/j.ajbio.20170504.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajbio.20170504.11},
  abstract = {Constructing global real interest rates at short and long maturities and reviews their evolution since 1980. It also traces the evolution of the cost of capital, It then analyzed key factors that could explained the observed pattern, shift in savings, changes in monetary and fiscal policy, shift in investment demand, changes in relative prices of investment, monetary policy and portfolio shifts between bonds and equity. It closes by considering how the main factors behind the decline in real interest rates might play out in the medium term. Real interest rates and the cost of capital are likely to rise moderately in the medium term from current level. Part of the reason is cyclical, the extremely low real interest rates of recent years reflects large negative output gaps in advanced economies. Indeed, the real interest rates might have declined even further in the absence of the zero lower bound on nominal interest rate.},
 year = {2017}
}

Copy | Download

TY  - JOUR
T1  - Global Interest Rate Environment with Emphasis on Quantitative Easing Implications
AU  - Emmanuel Teitey
Y1  - 2017/06/01
PY  - 2017
N1  - https://doi.org/10.11648/j.ajbio.20170504.11
DO  - 10.11648/j.ajbio.20170504.11
T2  - American Journal of BioScience
JF  - American Journal of BioScience
JO  - American Journal of BioScience
SP  - 59
EP  - 63
PB  - Science Publishing Group
SN  - 2330-0167
UR  - https://doi.org/10.11648/j.ajbio.20170504.11
AB  - Constructing global real interest rates at short and long maturities and reviews their evolution since 1980. It also traces the evolution of the cost of capital, It then analyzed key factors that could explained the observed pattern, shift in savings, changes in monetary and fiscal policy, shift in investment demand, changes in relative prices of investment, monetary policy and portfolio shifts between bonds and equity. It closes by considering how the main factors behind the decline in real interest rates might play out in the medium term. Real interest rates and the cost of capital are likely to rise moderately in the medium term from current level. Part of the reason is cyclical, the extremely low real interest rates of recent years reflects large negative output gaps in advanced economies. Indeed, the real interest rates might have declined even further in the absence of the zero lower bound on nominal interest rate.
VL  - 5
IS  - 4
ER  -

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