Uneasy calm in markets over expected US rate increase, say central bankers

Bank for International Settlements says restrained reaction, especially from emerging markets, to signals from US Federal Reserve is encouraging

An uneasy calm prevails in financial markets over the first increase in US interest rates in almost a decade, which is widely expected later this month, according to a leading group of central bankers.

The restrained reaction, especially from emerging markets, to signals from the US Federal Reserve that rates will start to rise have been encouraging, the quarterly update from the Switzerland-based Bank for International Settlements (BIS) said. However, it said it expected volatility to return.