Economy

US Treasurys higher as investors prepare for Federal Reserve meeting

US Treasurys higher as investors prepare for Federal Reserve meeting”

Citing strength in the USA job market, business investment growth, and "moderate but durable" economic expansion, the Federal Reserve-as expected-left interest rates unchanged at the end of its two-day policy meeting Wednesday.

Crucially for financial markets, the Fed's projections of the path for the federal funds remained essentially unchanged for this year and next - Fed officials still see one more quarter-point increase before the end of this year (probably December), and three such hikes next year.

"Information received since the Federal Open Market Committee met in July indicates that the labor market has continued to strengthen and that economic activity has been rising moderately so far this year". It added that the near-term risks to the economic outlook remained "roughly balanced" but that inflation was being watched "closely". If it goes wrong, it could send stock and bond markets into a tailspin that could spill over into the broader economy.

According to the CME FedWatch, investors have priced in a 70.5% chance of a rate increase in December; two days ago the odds were 56.6%. But in close-to-zero rate territory, QE allows policymakers to buy longer-term bonds at a much larger scale, with the hopes that doing so will also pull down long-term interest rates as well.

Investors were also assessing the likely impact of the Fed's decision to start ending monetary stimulus by reducing its approximately $4.2 trillion in holdings of U.S. Treasury bonds and mortgage-backed securities from October. The balance-sheet expansion was result of the Fed's so-called quantitative-easing programs - buying up financial assets to keep money flowing through the economy.

Five of the 11 major S&P sectors were lower, with the consumer staples index's .SPLRCS 0.74 percent fall leading the decliners.

The U.S. dollar rose against a basket of currencies .DXY after the release of the Fed's policy statement. It now projects even faster growth this year of 2.4 percent, an increase from it forecast of 2.1 percent earlier this year.

He has offered mild praise of Yellen after calling her "obviously political" during the 2016 campaign, insisting she held down interest rates under President Obama to make the economy look stronger than it actually was.

"This implies that in the absence of inflation, there may be little need for additional Fed rate hikes to tighten financial conditions", says Patel. Besides, the Fed hinted that one more interest rate hike may be introduced before the end of the year.

"We were definitely not pricing in another rate hike for this year", Hurley said.

"The BOJ will patiently continue accommodative monetary policy to achieve 2 percent inflation".



Like this

Latest


22 September 2017
'Game of Thrones' Producer to Write Fifth Prequel Series
From those humble beginnings, he advanced to staff writer, to story editor, to co-producer and producer and supervising producer. Some of his episodes include "Kissed by Fire" in Season 3 and "Stormborn" in Season 7.

22 September 2017
Sorority investigated for singing n-word lyric in Kanye West song
The school's Dean of Students, John Kirkpatrick, told the Union Leader that the video was "counter" to the values at the school. One of the girls had the video on her Instagram story, which is where the Facebook group acquired it.

22 September 2017
Shannon Bream To Fill Prime-Time Slot With 'Fox News @Night'
Fox News at Night , the name of the program, will include a full hour of live news and analysis. ET where it was regularly among the most-watched shows in all of cable news.

22 September 2017
Marine Corps Expects to Have First Female Infantry Officer
In the past, the Marines were often viewed as the most resistant to full gender integration in the military, the Post noted. Ten percent of students typically fail on the first day and 25 percent don't make it through the entire course.

22 September 2017
Alexion Pharmaceuticals, Inc. (NASDAQ:ALXN) Sees Significantly Lower Trading Volume
Currently, 222.3 million total shares are owned by the public and among those 205.27 million shares have been available to trade. Following the transaction, the director now directly owns 5,480 shares in the company, valued at approximately $799,038.80.

22 September 2017
State reports 2nd human case of West Nile Virus
A man from Hampden County is the second person in MA confirmed to have contracted West Nile Virus this year. MA officials are confirming the second human case of West Nile virus in the state this year.

22 September 2017
Westfield Capital Management Reduces Stake in Palo Alto Networks,
BidaskClub upgraded Palo Alto Networks from a "strong sell" rating to a "sell" rating in a research note on Thursday, August 17th. As of the end of the quarter Baird Financial Group, Inc. had disposed of a total of 9,008 shares trimming its position 10.2%.

22 September 2017
Mnuchin: Companies working with North Korea are 'on notice'
Mnuchin said that the sanctions are not specifically aimed at China, North Korea's largest trading partner. The aim of this action would be to keep North Korea from continuing with its nuclear program.

22 September 2017
Malala meets PM Abbasi, discusses female education in Pakistan
Abbasi said he held a meeting with former Prime Minister Nawaz Sharif - who is in London these days. Though he added that it is totally India's wish if the country wants to provide any economic help.

22 September 2017
Barcelona forward Ousmane Dembele hints at early recovery after surgery
Sakari Orava, who was accompanied by Barcelona doctor Ricard Pruna. The procedure was conducted by specialist Dr. Sakari Orava performed the surgery".



Recommended