Vocabulary Builder — Essay & Answer Writing
tapering
The gradual reduction of an activity or programme — particularly used in monetary policy to describe a central bank's gradual withdrawal of asset-purchase or stimulus programmes
Old English tapor (candle); the financial term was popularised in May 2013 by US Federal Reserve Chairman Ben Bernanke's announcement of slowing bond purchases
"The 2013 'taper tantrum' — when emerging markets including India faced massive capital outflows after Bernanke announced US Fed tapering — established a template for understanding how monetary policy uncertainty in advanced economies can destabilise developing economies."
Important vocabulary for GS3 Economy, particularly for international monetary policy and India's macroeconomic vulnerability. The 'taper tantrum' of 2013 is a frequently referenced UPSC topic in the context of the 'Fragile Five' (India, Brazil, Indonesia, South Africa, Turkey). Used in analyses of capital flow management, RBI policy responses, and emerging market fragility.
