In earlier decades, it was not uncommon for monetary tightening in advanced economies to usher in a period of stress in emerging market economies (EMEs). During the late 1970s and early 1980s which featured tighter monetary policy in the United States and elsewhere, many EMEs experienced financial stress and a collapse in GDP growth (Graph 1.A). A similar wave unfolded following the 1994–95 tightening cycle. By comparison, the experience since 2000 has been much more benign.1 The “taper tantrum” in May 2013 was only a partial exception: the mere anticipation of such tightening was sufficient to cause severe strains in EME financial markets (Graph 1.B), but these were short-lived and did not hit GDP. […]