At its meeting on 2–3 November, the U.S. Federal Open Market Committee (FOMC) began a process of quantitative easing, launching a US$600-billion eight-month programme of purchases of long-term securities.
IHS Global Insight Perspective
Significance: The markets have been speculating on when the Federal
Reserve would start quantitative easing for many weeks, so the announcement
came as no real surprise.
Implications: When added to the existing programme for the reinvestment
of mortgage principal repayments, the Fed's balance sheet could expand by close
to US$900 billion. This is still not as high as some had speculated.
Outlook: The Fed's activities appear to be paying off with various
pieces of good economic news of late.
Fed Nudges the Economy Along
At its latest scheduled meeting, the U.S. Federal Open
Market Committee (FOMC) elected to leave the target range for federal funds
unchanged at its historic low of 0.0% to 0.25%. It re-asserted the "EE
phrase" that "economic conditions [are] likely to warrant
exceptionally low rates for an extended period". The FOMC will also
continue to reinvest mortgage principal repayments. The economic recovery has
been moving at a very slow pace, so the FOMC decided to expand its holding of
securities in order to speed up the pace of economic recovery. It plans to
purchase an additional US$600 billion in long-term Treasury securities by the
end of the second quarter of 2011 at a pace of about US$75 billion per month.
The FOMC will review the programme on an ongoing basis and adjust as needed
based on the performance of the economy and prices. Kansas City's Federal
Reserve chief, Thomas Hoenig, cast a dissenting vote for the seventh meeting in
a row, stating that the "risks of additional securities purchases
outweighed the benefits".
The FOMC flagged familiar risks to the outlook:
Household spending is constrained by high unemployment,
modest income growth, lower housing wealth, and tight credit.
Commercial construction remains weak and businesses
remain reluctant to add to payrolls.
Housing starts remain at a depressed level.
The high level of unemployment and relatively low level
of underlying inflation are inconsistent with the Fed's dual mandate of
fostering maximum employment and price stability.
Outlook and Implications
By pushing the button on quantitative easing, the FOMC
basically delivered what the markets had expected, and speculated about, for
many weeks. There were no big surprises here. When added to the existing
programme for the reinvestment of mortgage principal repayments, the Fed's
balance sheet could expand by close to US$900 billion. The most problematic
issue that the Fed must deal with is the management of market expectations.
Markets had already discounted the programme weeks ago, but there had been
considerable speculation about the size of the programme, including some wild
estimates as high as US$2 trillion. The 10-year bond yield dropped sharply in
early October, to near 2.4%, just in advance of Bernanke's definitive speech on
15 October. As markets recalibrated expectations, the 10-year bond yield cycled
back up to near 2.6%. The Fed's programme was broadly in line with
expectations, so the bond market reaction was relatively muted when the press
release hit the markets. The stock market reaction was also muted.
The good news is that mortgage rates have tracked
downwards to near 4.25%, and the stock market has risen not only in response to
recent positive earnings reports, but in anticipation of some positive benefits
to the economy from the Fed's recent actions. From a portfolio balance
perspective, the US$600-billion programme announced by the Fed on 3 November
will devour roughly half of the Treasury's US$1.3-trillion funding requirement
for fiscal 2011. Thus, barring a sudden and unexpected upturn in economic activity,
IHS Global Insight expects long-term bond yields will probably ease down over
the next several weeks to land near 2.5% in early 2011. Mortgage rates,
therefore, are expected to remain at historically low levels for the next
several months, and that will be a support to the housing market.
More good news is that the Fed's actions over the past
several months are already starting to have a positive impact on economic
activity, with the ISM indicators for both manufacturing and services perking
up in October, and recent indicators also pointing to slightly stronger
private-sector job growth as we enter the fourth quarter. The economy is
slowing digging itself out of a deep hole. The Fed is making the right moves
here to nudge the pace of digging up a little.
fecha |
Título |
03/04/2011| |
|
26/03/2011| |
|
20/03/2011| |
|
26/02/2011| |
|
18/02/2011| |
|
18/02/2011| |
|
15/02/2011| |
|
12/02/2011| |
|
10/02/2011| |
|
10/02/2011| |
|
07/02/2011| |
|
03/02/2011| |
|
01/02/2011| |
|
29/01/2011| |
|
26/01/2011| |
|
26/01/2011| |
|
26/01/2011| |
|
25/01/2011| |
|
22/01/2011| |
|
20/01/2011| |
|
20/01/2011| |
|
18/01/2011| |
|
18/01/2011| |
|
17/01/2011| |
|
17/01/2011| |
|
15/01/2011| |
|
14/01/2011| |
|
12/01/2011| |
|
12/01/2011| |
|
10/01/2011| |
|
06/01/2011| |
|
06/01/2011| |
|
01/01/2011| |
|
31/12/2010| |
|
31/12/2010| |
|
25/12/2010| |
|
25/12/2010| |
|
25/12/2010| |
|
18/12/2010| |
|
14/12/2010| |
|
10/12/2010| |
|
26/11/2010| |
|
26/11/2010| |
|
20/11/2010| |
|
17/11/2010| |
|
17/11/2010| |
|
17/11/2010| |
|
15/11/2010| |
|
13/11/2010| |
|
13/11/2010| |
|
12/11/2010| |
|
12/11/2010| |
|
05/11/2010| |
|
04/11/2010| |
|
31/10/2010| |
|
09/10/2010| |
|
02/10/2010| |
|
02/10/2010| |
|
17/09/2010| |
|
10/09/2010| |
|
10/09/2010| |
|
10/07/2010| |
|
10/07/2010| |
|
08/04/2010| |
|
05/04/2010| |
|
18/03/2010| |
|
17/03/2010| |
|
16/03/2010| |
|
09/03/2010| |
|
09/03/2010| |
|
05/03/2010| |
|
05/03/2010| |
|
04/03/2010| |
|
03/03/2010| |
|
01/03/2010| |
|
26/02/2010| |
|
26/02/2010| |
|
24/02/2010| |
|
23/02/2010| |
|
22/02/2010| |
|
20/02/2010| |
|
20/02/2010| |
|
17/02/2010| |
|
17/02/2010| |
|
16/02/2010| |
|
15/02/2010| |
|
12/02/2010| |
|
11/02/2010| |
|
10/02/2010| |
|
09/02/2010| |
|
08/02/2010| |
|
05/02/2010| |
|
04/02/2010| |
|
04/02/2010| |
|
04/02/2010| |
|
02/02/2010| |
|
01/02/2010| |
|
31/01/2010| |
|
31/01/2010| |
|
22/01/2010| |
|
21/01/2010| |
|
20/01/2010| |
|
19/01/2010| |
|
19/01/2010| |
|
15/01/2010| |
|
14/01/2010| |
|
13/01/2010| |
|
12/01/2010| |
|
11/01/2010| |
|
08/01/2010| |
|
07/01/2010| |
|
07/01/2010| |
|
05/01/2010| |
|
04/01/2010| |
|
31/12/2009| |
|
31/12/2009| |
|
30/12/2009| |
|
24/12/2009| |
|
23/12/2009| |
|
22/12/2009| |
|
21/12/2009| |
|
18/12/2009| |
|
17/12/2009| |
|
16/12/2009| |
|
15/12/2009| |
|
15/12/2009| |
|
14/12/2009| |
|
14/12/2009| |
|
13/12/2009| |
|
13/12/2009| |
|
11/12/2009| |
|
11/12/2009| |
|
10/12/2009| |
|
10/12/2009| |
|
08/12/2009| |
|
08/12/2009| |
|
08/12/2009| |
|
08/12/2009| |
|
04/12/2009| |
|
04/12/2009| |
|
04/12/2009| |
|
04/12/2009| |
|
03/12/2009| |
|
03/12/2009| |
|
01/12/2009| |
|
01/12/2009| |
|
01/12/2009| |
|
01/12/2009| |
|
27/11/2009| |
|
27/11/2009| |
|
26/11/2009| |
|
26/11/2009| |
|
25/11/2009| |
|
25/11/2009| |
|
24/11/2009| |
|
24/11/2009| |
|
23/11/2009| |
|
23/11/2009| |
|
22/11/2009| |
|
22/11/2009| |
|
16/11/2009| |
|
16/11/2009| |
|
13/11/2009| |
|
13/11/2009| |
|
11/11/2009| |
|
11/11/2009| |
|
11/11/2009| |
|
11/11/2009| |
|
10/11/2009| |
|
10/11/2009| |
|
07/11/2009| |
|
06/11/2009| |
|
04/11/2009| |
|
04/11/2009| |
|
02/11/2009| |
|
31/10/2009| |
|
30/10/2009| |
|
29/10/2009| |
|
28/10/2009| |
|
27/10/2009| |
|
21/10/2009| |
|
21/10/2009| |
|
19/10/2009| |
|
15/10/2009| |
|
14/10/2009| |
|
13/10/2009| |
|
12/10/2009| |
|
09/10/2009| |
|
09/10/2009| |
|
07/10/2009| |
|
06/10/2009| |
|
05/10/2009| |
|
02/10/2009| |
|
01/10/2009| |
|
01/10/2009| |
|
01/10/2009| |
|
30/09/2009| |
|
30/09/2009| |
|
21/09/2009| |
|
19/09/2009| |
|
17/09/2009| |
|
16/09/2009| |
|
15/09/2009| |
|
14/09/2009| |
|
12/09/2009| |
|
12/09/2009| |
|
12/09/2009| |
|
10/09/2009| |
|
09/09/2009| |
|
08/09/2009| |
|
07/09/2009| |
|
05/09/2009| |
|
04/09/2009| |
|
03/09/2009| |
|
02/09/2009| |
|
01/09/2009| |
|
31/08/2009| |
|
29/08/2009| |
|
27/08/2009| |
|
27/08/2009| |
|
26/08/2009| |
|
24/08/2009| |
|
21/08/2009| |
|
20/08/2009| |
|
19/08/2009| |
|
18/08/2009| |
|
17/08/2009| |
|
14/08/2009| |
|
14/08/2009| |
|
14/08/2009| |
|
14/08/2009| |
|
12/08/2009| |
|
12/08/2009| |
|
11/08/2009| |
|
11/08/2009| |
|
10/08/2009| |
|
10/08/2009| |
|
07/08/2009| |
|
07/08/2009| |
|
06/08/2009| |
|
06/08/2009| |
|
05/08/2009| |
|
05/08/2009| |
|
04/08/2009| |
|
04/08/2009| |
|
03/08/2009| |
|
03/08/2009| |
|
01/08/2009| |
|
01/08/2009| |
|
29/07/2009| |
|
29/07/2009| |
|
29/07/2009| |
|
29/07/2009| |
|
27/07/2009| |
|
27/07/2009| |
|
25/07/2009| |
|
25/07/2009| |
|
23/07/2009| |
|
23/07/2009| |
|
23/07/2009| |
|
23/07/2009| |
|
21/07/2009| |
|
21/07/2009| |
|
20/07/2009| |
|
20/07/2009| |
|
17/07/2009| |
|
17/07/2009| |
|
16/07/2009| |
|
16/07/2009| |
|
16/07/2009| |
|
15/07/2009| |
|
15/07/2009| |
|
15/07/2009| |
|
28/03/2009| |
|
15/03/2009| |
|
15/03/2009| |
|
15/03/2009| |
|
15/03/2009| |
|
18/01/2009| |
|
10/01/2009| |
|
06/01/2009| |
|
05/01/2009| |
|
02/01/2009| |
|
24/12/2008| |
|
24/12/2008| |
|
24/12/2008| |
|
27/11/2008| |
|
27/11/2008| |
|
27/11/2008| |
|
27/11/2008| |
|
03/10/2008| |
|
03/10/2008| |
|
03/10/2008| |
|
03/10/2008| |
|
24/09/2008| |
|
24/09/2008| |
|
20/09/2008| |
|
20/09/2008| |
|
18/09/2008| |
|
18/09/2008| |
|
18/09/2008| |
|
18/09/2008| |
|
10/09/2008| |
|
10/09/2008| |
|
08/09/2008| |
|
08/09/2008| |
|
17/08/2008| |
|
17/08/2008| |
|
11/08/2008| |
|
11/08/2008| |
|
11/08/2008| |
|
11/08/2008| |
|
11/08/2008| |
|
11/08/2008| |
|
13/05/2008| |
|
12/05/2008| |
|
12/05/2008| |
|
10/05/2008| |
|
04/05/2008| |
|
02/05/2008| |
|
27/04/2008| |
|
27/04/2008| |
|
24/04/2008| |
|
24/04/2008| |
|
24/04/2008| |
|
24/04/2008| |
|
24/04/2008| |
|
24/04/2008| |
|
06/04/2008| |
|
26/03/2008| |
|
20/03/2008| |
|
19/03/2008| |
|
13/03/2008| |
|
10/03/2008| |
|
07/03/2008| |
|
05/03/2008| |
|
18/02/2008| |
|
06/02/2008| |
|
03/02/2008| |
|
01/02/2008| |
|
01/02/2008| |
|
21/12/2007| |
|
21/12/2007| |
|
08/12/2007| |
|
08/12/2007| |
|
02/11/2007| |
|
30/10/2007| |
|
30/10/2007| |
|
27/10/2007| |
|
25/10/2007| |
|
20/10/2007| |
|
04/10/2007| |
|
28/09/2007| |
|
28/09/2007| |
|
31/08/2007| |
|
31/08/2007| |
|
30/08/2007| |
|
30/08/2007| |
|
15/08/2007| |
|
11/08/2007| |
|
11/08/2007| |
|
31/07/2007| |
|
28/07/2007| |
|
28/07/2007| |
|
04/07/2007| |
|
30/06/2007| |
|
30/06/2007| |
|
30/06/2007| |
|
30/06/2007| |
|
16/06/2007| |
|
16/06/2007| |
|
16/06/2007| |
|
16/06/2007| |
|
13/06/2007| |
|
13/06/2007| |
|
10/06/2007| |
|
10/06/2007| |
|
10/06/2007| |
|
10/06/2007| |
|
10/06/2007| |
|
10/06/2007| |
|
16/05/2007| |
|
16/05/2007| |
|
03/05/2007| |
|
03/05/2007| |
|
03/05/2007| |
|
03/05/2007| |
|
03/05/2007| |
|
03/05/2007| |
|
30/04/2007| |
|
30/04/2007| |
|
26/04/2007| |
|
26/04/2007| |
|
25/04/2007| |
|
25/04/2007| |
|
25/04/2007| |
|
25/04/2007| |
|
21/04/2007| |
|
21/04/2007| |
|
19/04/2007| |
|
19/04/2007| |
|
19/04/2007| |
|
19/04/2007| |
|
19/04/2007| |
|
19/04/2007| |
|
19/04/2007| |
|
19/04/2007| |
|
10/04/2007| |
|
10/04/2007| |
|
07/04/2007| |
|
07/04/2007| |
|
04/04/2007| |
|
04/04/2007| |
|
02/04/2007| |
|
02/04/2007| |
|
01/04/2007| |
|
28/03/2007| |
|
28/03/2007| |
|
25/03/2007| |
|
25/03/2007| |
|
20/03/2007| |
|
20/03/2007| |
|
28/02/2007| |
|
23/01/2007| |
|
23/01/2007| |
|
08/01/2007| |
|
08/01/2007| |
|
08/01/2007| |
|
08/01/2007| |
|
06/01/2007| |
|
06/01/2007| |
|
04/01/2007| |
|
04/01/2007| |
|
29/12/2006| |
|
29/12/2006| |
|
28/12/2006| |
|
28/12/2006| |
|
26/12/2006| |
|
26/12/2006| |
|
26/12/2006| |
|
26/12/2006| |
|
26/12/2006| |
|
26/12/2006| |
|
26/12/2006| |
|
26/12/2006| |
|
26/12/2006| |
|
26/12/2006| |
|
20/12/2006| |
|
20/12/2006| |
|
20/12/2006| |
|
20/12/2006| |
|
16/12/2006| |
|
16/12/2006| |
|
16/12/2006| |
|
16/12/2006| |
|
15/12/2006| |
|
15/12/2006| |
|
14/12/2006| |
|
14/12/2006| |
|
14/12/2006| |
|
14/12/2006| |
|
14/12/2006| |
|
14/12/2006| |
|
12/12/2006| |
|
12/12/2006| |
|
12/12/2006| |
|
12/12/2006| |
|
11/12/2006| |
|
11/12/2006| |
|
11/12/2006| |
|
11/12/2006| |
|
11/12/2006| |
|
11/12/2006| |
|
11/12/2006| |
|
11/12/2006| |
|
09/12/2006| |
|
09/12/2006| |
|
02/12/2006| |
|
02/12/2006| |
|
02/12/2006| |
|
02/12/2006| |
|
25/11/2006| |
|
25/11/2006| |
|
23/11/2006| |
|
23/11/2006| |
|
22/11/2006| |
|
22/11/2006| |
|
21/11/2006| |
|
21/11/2006| |
|
21/11/2006| |
|
21/11/2006| |
|
21/11/2006| |
|
21/11/2006| |
|
11/11/2006| |
|
11/11/2006| |
|
02/11/2006| |
|
01/11/2006| |
|
01/11/2006| |
|
28/10/2006| |
|
28/10/2006| |
|
28/10/2006| |
|
28/10/2006| |
|
20/10/2006| |
|
20/10/2006| |
|
20/10/2006| |
|
20/10/2006| |
|
14/10/2006| |
|
14/10/2006| |
|
07/10/2006| |
|
07/10/2006| |
|
07/10/2006| |
|
05/10/2006| |
|
04/10/2006| |
|
04/10/2006| |
|
04/10/2006| |
|
04/10/2006| |
|
23/09/2006| |
|
23/09/2006| |
|
23/09/2006| |
|
23/09/2006| |
|
23/09/2006| |
|
23/09/2006| |
|
06/09/2006| |
|
04/09/2006| |
|
04/09/2006| |
|
02/09/2006| |
|
02/09/2006| |
|
02/09/2006| |
|
01/09/2006| |
|
30/08/2006| |
|
02/08/2006| |
|
02/08/2006| |
|
30/07/2006| |
|
30/07/2006| |
|
27/07/2006| |
|
27/07/2006| |
|
21/07/2006| |
|
20/07/2006| |
|
20/07/2006| |
|
18/07/2006| |
|
16/07/2006| |
|
13/07/2006| |
|
12/07/2006| |
|
12/07/2006| |
|
07/07/2006| |
|
07/07/2006| |
|
06/07/2006| |
|
29/06/2006| |
|
29/06/2006| |
|
29/06/2006| |
|
29/06/2006| |
|
28/06/2006| |
|
26/06/2006| |
|
26/06/2006| |
|
21/06/2006| |
|
21/06/2006| |
|
20/06/2006| |
|
20/06/2006| |
|
04/06/2006| |
|
09/05/2006| |
|
03/05/2006| |
|
03/05/2006| |
|
03/05/2006| |
|
03/05/2006| |
|
18/02/2006| |
|
04/02/2006| |
|
04/02/2006| |
|
29/01/2006| |
|
23/09/2005| |
|