Question

What is the meaning of the term 'taper tantrum' used in monetary policy discussions?

Q: Answer-What is the meaning of the term 'taper tantrum' used in monetary policy discussions?

Taper tantrum is the term used for the 2013 surge in U.S. Treasury yields, which resulted from the Federal Reserves use of tapering to gradually reduce the amount of money it was feeding into the economy.

A Creating fiscal deficit to increase money supply

B Increasing the money supply in the economy by the Federal Reserve

C Neutral Monetary Policy stance by Federal Reserve with increase in the policy rates

D Gradual withdrawal from the policy of feeding money into the economy

E Accommodative monetary policy by the central bank

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What is the meaning of the term 'taper tantrum' used in monetary policy discussions?

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