Signs are emerging that we may be entering a new stage in the long, drawn-out, bumpy global economic recovery following the global financial crisis. Private sector economic conditions and confidence indicators in several developed economies suggest increasing stability and a more promising outlook. This may permit monetary authorities in the developed economies, starting in the United States, to taper — and ultimately to withdraw — monetary policy support. What are the implications for real estate in Asia Pacific?

Economic outlook in the era of monetary policy tapering

Earlier this year, financial markets were spooked by the suggestion by US Federal Reserve Chairman Ben Bernanke that the Fed might be on the verge of starting to taper its regular monthly bond purchases. A flurry of policy clarifications settled nerves but not before US Treasury yields moved sharply higher and equities sharply lower. This has focused attention on how differe