Tags » FOMC
This past Wednesday, the Federal Reserve Board raised interest rate by 0.25%, the fourth increase since last year. At the same time, it announced that it will reduce the size of its balance sheet by USD 30 billion per month, increasing eventually to USD 50 billion per month. 1,093 more words
It’s about Dudley for the dollar which rose to a three-week high versus the yen overnight.
As usual, it was a good cop/bad cop type of deal on Monday with Evans coming across as some semblance of dovish yesterday evening (“could delay next hike until December to assess data”), but Dudley’s “need to do it now so we don’t have to slam on the brakes later” soundbite combined with his contention that “the economic expansion has a way to run and that wage growth is likely to quicken,” supported the greenback. 592 more words
This morning I had the pleasure of sitting with a professional trader and discussing several themes that have coursed through NOTES FROM UNDERGROUND for the past several months, if not years. 440 more words
Lots of people are understandably concerned about what happens when the Fed starts to shrink its balance sheet.
At some basic level, the angst is tied to the fact that what we’ve seen since the crisis in terms of central bank balance sheet bloat is unprecedented and so, it’s by definition impossible to know what happens when it’s unwound. 1,313 more words