Tapering: meaning, definitions and examples
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tapering
[ ˈteɪpərɪŋ ]
financial policy
Tapering refers to the gradual reduction of the pace of asset purchases by a central bank, aimed at decreasing the amount of stimulus in the economy. This action is typically implemented following a period of quantitative easing, when a central bank has been buying government bonds to inject liquidity into the financial system. The intention behind tapering is to carefully manage inflation and signal confidence in the economic recovery while preventing abrupt disruptions that could arise from sudden tightening of monetary policy.
Synonyms
diminishing, lessening, reducing.
Examples of usage
- The Federal Reserve announced tapering of its bond-buying program.
- Market reactions often fluctuate during periods of tapering.
- Investors closely monitor tapering announcements for interest rate changes.
Translations
Translations of the word "tapering" in other languages:
🇵🇹 redução gradual
- afunilamento
- estreitamento
🇮🇳 कम करना
🇩🇪 Abschmelzen
- Verengung
- Reduzierung
🇮🇩 penyusutan
🇺🇦 звуження
🇵🇱 stopniowe zmniejszenie
🇯🇵 テーパリング
🇫🇷 réduction progressive
🇪🇸 reducción gradual
🇹🇷 azaltma
🇰🇷 점진적 감소
🇸🇦 تقليل تدريجي
🇨🇿 postupné snižování
🇸🇰 postupné znižovanie
🇨🇳 逐步减少
🇸🇮 postopno zmanjšanje
🇮🇸 smáminnkun
🇰🇿 постепенное қысқарту
🇬🇪 პროგრესული შემცირება
🇦🇿 tədricən azalma
🇲🇽 reducción gradual
Etymology
The word 'tapering' is derived from the verb 'taper', which has its roots in Middle English 'taperen', meaning to diminish or decrease gradually. The term gained prominence in the economic context particularly during the post-2008 financial crisis, when central banks engaged in extensive asset purchase programs to stimulate economic growth. As these economies began to recover, the need to scale back these purchases arose, giving birth to the term 'tapering'. This concept has since been instrumental in discussions surrounding monetary policy and economic recovery strategies, especially as market participants respond to signals from central banks regarding future economic conditions.