10 Jul 2014
No room for surprises in the FOMC minutes – Danske Bank
FXStreet (Edinburgh) - In the opinion of Morten Helt, Senior Analyst at Danske Bank, yesterday’s FOMC minutes kept the neutral tone.
Key Quotes
“According to the FOMC minutes from the 17-18 June meeting released last night, the Fed will end its QE3 programme with a USD15bn taper in October barring any economic surprises”.
“For the first time the Fed now signals a clear end-date for QE3 and while timing and pace of interest rate increases remain under debate, it seems highly likely that this will become a market theme later in H2”.
“The Fed also debated its ‘exit strategy’ and how it should communicate its future policy to financial markets”.
“According to the minutes, ‘many’ Fed officials want to keep reinvesting income in their asset purchases until at or after the time that interest rates rise, which would be a change to the current strategy of stopping reinvestment before raising rates”.
“Moreover, ‘many’ officials indicated a preference for continuing to express the target Federal Funds rate as a range when the Fed eventually starts to raise rates instead of giving a single number as it did in the past”.
Key Quotes
“According to the FOMC minutes from the 17-18 June meeting released last night, the Fed will end its QE3 programme with a USD15bn taper in October barring any economic surprises”.
“For the first time the Fed now signals a clear end-date for QE3 and while timing and pace of interest rate increases remain under debate, it seems highly likely that this will become a market theme later in H2”.
“The Fed also debated its ‘exit strategy’ and how it should communicate its future policy to financial markets”.
“According to the minutes, ‘many’ Fed officials want to keep reinvesting income in their asset purchases until at or after the time that interest rates rise, which would be a change to the current strategy of stopping reinvestment before raising rates”.
“Moreover, ‘many’ officials indicated a preference for continuing to express the target Federal Funds rate as a range when the Fed eventually starts to raise rates instead of giving a single number as it did in the past”.