The first round of QE in the US, mainly aimed at improving market functioning, had a smaller impact on equity markets and exchange rates in emerging market economies (EMEs) than the second round of QE policies implemented through large-scale asset purchases (see slide 4).
As chairman of the Global Economy Meetings of central bank governors in Basel, I myself reported my colleagues’ sentiments on this matter. We also said publicly, long before the difficult time we are going through today, that the private sector had to prepare for a market correction, because such a correction was inevitable.