The long-awaited FOMC meeting was eventually held last week. Market reactions showed that investors were buoyed by Fed’s new round of quantitative measures. The central bank pledged to buy $600B of US Treasury securities by the end of June 2011 so as to revive the recovery. Risk appetite was also boosted as the Fed committed to monitor ‘the economic outlook and financial developments and will employ its policy tools as necessary to support the economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate’. This signals further easing measures will be implemented to ensure the economy to grow above trend.
Continued here:
Weekly Fundamentals – Hurray for QE2
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