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23 Sep 2013
Flash: The week after the Fed stood still-Rabobank
FXstreet.com (Athens)- Rabobank Financial Markets Research Team suggest that Last week’s surprise outcome of the FOMC’s September meeting pushed US treasury yields back and the EUR/USD up.
Key Quotes
“Now that the Fed has delayed its first taper, both the financial markets and the FOMC will be looking for evidence that the economic recovery is able to deal with the rise in longer-term rates that we have seen earlier this year, because that would support a decision to start tapering later this year.”
“Later today, FOMC participants Lockhart, Dudley and Fisher will speak.”
“The German elections led to a clear victory for Angela Merkel, whose centre right CDU/CSU got 41.5% of the votes. The main competitor, the social democratic SPD, only got 25.7%. However, since Merkel did not get an absolute majority, she will need a coalition partner.”
“On Friday, Esther George (Kansas City Fed), who was the sole dissenter from last Wednesday’s FOMC decision, and the most hawkish voting member of the Committee, said that the actions at this meeting, and the expectations that have been set relative how markets were thinking about this, created confusion, created a disconnect.”
“In contrast, James Bullard (St. Louis Fed), who voted in support of last week’s decision, and a more dovish FOMC member, said that low readings on inflation allow the Fed to be patient in deciding when to start tapering.”
Key Quotes
“Now that the Fed has delayed its first taper, both the financial markets and the FOMC will be looking for evidence that the economic recovery is able to deal with the rise in longer-term rates that we have seen earlier this year, because that would support a decision to start tapering later this year.”
“Later today, FOMC participants Lockhart, Dudley and Fisher will speak.”
“The German elections led to a clear victory for Angela Merkel, whose centre right CDU/CSU got 41.5% of the votes. The main competitor, the social democratic SPD, only got 25.7%. However, since Merkel did not get an absolute majority, she will need a coalition partner.”
“On Friday, Esther George (Kansas City Fed), who was the sole dissenter from last Wednesday’s FOMC decision, and the most hawkish voting member of the Committee, said that the actions at this meeting, and the expectations that have been set relative how markets were thinking about this, created confusion, created a disconnect.”
“In contrast, James Bullard (St. Louis Fed), who voted in support of last week’s decision, and a more dovish FOMC member, said that low readings on inflation allow the Fed to be patient in deciding when to start tapering.”