Study on the Spillover Effects of Federal Reserve Monetary Policy on Global Asset Prices

DOI

10.2991/978-2-38476-611-6_86How to use a DOI?

Keywords

Fed Monetary Policy; FOMC Shocks; Forward Guidance; Quantitative Easing; Local Projections

Abstract

This paper investigates the spillover effects of Federal Reserve (Fed) monetary policy on asset prices across 33 economies from 1994 to 2024. By decomposing policy shocks into Target, Path, and LSAP factors and employing panel regressions alongside local projections, the study finds that Target and Path factors exert a significant negative impact on global equity markets, while Large-Scale Asset Purchases (LSAP) provide a stabilizing “floor” effect. Long-term interest rate fluctuations are primarily driven by the Path factor, and LSAP effectively compresses term premiums. Heterogeneity analysis reveals that while capital account openness does not alter the magnitude of the initial shock, it significantly shapes the price adjustment path: high-openness countries recover more rapidly, whereas low-openness countries experience more protracted adjustment cycles. Given that these shocks are typically absorbed within 10–15 trading days, this paper provides empirical evidence supporting the implementation of differentiated policy responses across nations.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 3.0 International License (http://creativecommons.org/licenses/by-nc/3.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Download article (PDF)

TY  - CONF
AU  - Xueshan Zhou
PY  - 2026
DA  - 2026/09/07
TI  - Study on the Spillover Effects of Federal Reserve Monetary Policy on Global Asset Prices
BT  - Proceedings of the 2026 12th International Conference on Digital Humanities and Frontiers in Social Sciences (DHFSS 2026)
PB  - Atlantis Press
SP  - 789
EP  - 800
SN  - 2352-5398
UR  - https://doi.org/10.2991/978-2-38476-611-6_86
DO  - 10.2991/978-2-38476-611-6_86
ID  - Zhou2026
ER  -