Global turmoil has been acute this year, and a 5.4 percent decline in Japanese stocks and Japan's 10-year bond yield going negative Tuesday drove more concern across financial markets.
But Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi, said world market downturns are not justified by economic fundamentals and should not stall Federal Reserve tightening in the United States.
"It's not enough financial market turmoil for the Fed to pause, unless it's giving a signal that the U.S. economy is going to turn down in the future," Rupkey told CNBC's "Worldwide Exchange" on Tuesday. The world will be looking for clues in Fed Chair Janet Yellen's congressional testimony on economic conditions on Wednesday and Thursday.
Still, Rupkey said there's plenty of room for markets to tumble before this affects the broader economy. "I would think down 15 [or] 20 percent and sit down there, it has to be a serious decline. The Nasdaq has its own special issues, I don't know if that's the broader markets."
Jobs growth, he said, is the time-honored signal of a strong economy — pointing out that U.S.-style quantitative easing in the euro zone continues because of double-digit unemployment. But Japan's shift to negative interest rates last week seemed out of line with jobs.
"I don't understand it, all of these central banks are very different," Rupkey said. "Japan's unemployment rate is down at 3 percent. Everyone has a job, unemployment's very low there."
He cautioned about bringing negative rates to the United States. "I think it would scare the American public, it's a very unsound policy to even talk about that."