US - Fed 04 (Apr 21 - Dec 25)

[behappyalways]

Fed Alert: Reverse Repo Usage Nears Record As Repo Market Set To Blow
https://www.zerohedge.com/markets/fed-a ... t-set-blow

[winston]

Fed rattles markets with new timeline for rate increases

Federal Reserve officials signalled interest rates will rise sooner and faster than previously expected, a surprise development that comes as inflation runs much hotter than officials have anticipated.

That’s the main takeaway from the latest monetary policy statement and updated summary of economic projections released by the Federal Reserve’s monetary policy arm, the Federal Open Market Committee.

Seven officials now expect to lift interest rates next year, up from four officials in March. More important: All but five members think rates will need to increase in 2023.

In March, only 7 thought so, with 11 members expecting to keep rates pinned at zero.

Markets have been expecting no change in rates before 2024. And more important still is the fact that five officials now see rates at 1% or higher in 2023, suggesting rates won’t just rise sooner but faster.

This change in stance jars a little with the Fed’s recent claims that the recent spike in inflation is temporary and is not what the market expected.

With the interpretation that lift-off in interest rates will come sooner than expected, so too might tapering begin earlier than investors have planned.

Source: OCBC

[winston]

Fed unlikely to tighten the screws anytime soon

by Andrew Wong

Fed policymakers have brought forward the expected timeline for raising interest rates from 2024 to 2023, but as 2023 is still at least 19 months away, is it too early to start worrying about belt-tightening?

After the Fed started its first round of QE in March 2009, it began to withdraw QE almost five years later.

IMeanwhile, China's moves to tame prices will also help ease global inflationary pressures.

Therefore, it's a bit of an overreaction to assume that the Fed will reduce its bond purchases or raise interest rates in the next 12 months in the face of short-term inflationary pressures.

Financial markets in the United States were very volatile last week, but even after the huge sell-off, the S&P500 index is still up by 10 percent this year.

And, coupled with last year's gains - given the fact that US economy is still not back to where it was before the pandemic and the S&P500 is indeed a bit too high - investors should not be surprised that there was profit-taking last Friday, the "fourth settlement day," and profits were locked-in at the half-year mark.

Source: The Standard

https://www.thestandard.com.hk/section- ... ytime-soon

[winston]

St Louis Fed president James Bullard, told CNBC that rising inflation may warrant higher interest rates as early as next year.

Earlier, Fed chairman Jerome Powell had hinted rate increases may come in 2023.

Source: SCMP

[behappyalways]

点中美国通胀“死穴” 警惕美联储变相加息
https://m.youtube.com/watch?v=_S-0JpYWS8s

[winston]

Powell: Fed Will Not Raise Interest Rates Over Inflation Concerns Alone

Federal Reserve Chair Jerome Powell reiterated in Congress, that the Fed's monetary policy intends to foster board and all-rounded recovery in the employment market and will not propose premature interest hike over inflation fears alone.

Powell added that the Fed will only impose interest rate hike when there is concrete evidence of inflation and an imbalanced economy.

Related News: Fed Projects US 2021E Econ Growth at 7%, Lifts Inflation Forecast

Source: AAStocks Financial News

[behappyalways]

The Fed In A Box, Part 1: They Cannot Raise Interest Rates
https://www.zerohedge.com/markets/fed-b ... rest-rates

[winston]

Fed Minutes

While investors have been encouraged by the Federal Reserve, the central bank’s monetary policy has sparked a bout of inflation that is driving both supply and labour shortages, and could curtail the economy’s growth.

That is complicating the picture for investors, who worry that a correction is near.

Treasury yields edged lower following the Fed minutes, as stocks mostly edged higher.

Source: OCBC

[behappyalways]

通胀飙升5.4% 美联储错判了什么？
https://m.youtube.com/watch?v=23IZa70nvyA

[winston]

Fed to discuss a pullback in economic aid

Powell is gambling that the central bank can engineer an exceedingly delicate task: To keep the Fed’s short-term benchmark rate pegged near zero, where it has been since March 2020, until the job market has fully healed, without fueling a sustained bout of high inflation.

The main concern is that the Fed will end up responding too late and too aggressively to high inflation by quickly jacking up interest rates and perhaps causing another recession.

GS: The central bank will likely signal its intentions about two meetings before announcing a move. The Fed will provide its first clear hint about tapering at its September meeting, followed by another signal in November before announcing the actual taper in December.

Source: The Standard

https://www.thestandard.com.hk/breaking ... onomic-aid