The long-awaited taper has begun.
And as David Vines, a professor at Oxford University says this is likely to reverse the trend of money flowing into emerging markets, particularly in Asia.
He adds that the pace of tapering is under control.
"It's going to go down very, very slowly, and it would be managed. So at its best, it will lead to a gradual outflow of funds and a small fall in currencies. And that's what you have to hope for."
Professor Vines says the real risk is cross-currency transactions that aren't well hedged, but that a simple fall in the currency can be a good thing.
"This will help promote exports from East Asian economies, and that will be constructive for those economies."
Tighter liquidity in the U.S. will mean a stronger U.S. dollar and a weaker Japanese yen.
So, could that prompt a currency war in the coming months, given that Korea, China and Japan compete in export markets?
"It could. The hope is they will all fall against the dollar somewhat. And that there's not too much imbalance in that fall. If there's a very rapid outflow from one particular one of the countries, and that falls down, that's going to create turbulence. I wouldn't call it warfare, I would call it unfortunate battles."
Although the Fed's tapering of its bond-buying stimulus measures indicates a recovery in the U.S. economy, Professor Vines says the U.S. economy is still not at its full strength, because investment figures haven't picked up.
He went on to say that Asian economies, including Korea, should work on promoting more domestic expenditures that lead to longer-term development.
Hwang Ji-hye, Arirang News.