ECB Cuts Asset Purchases, Could Exit QE in Q3
— Rate Hikes to Come ‘Some Time After’ Asset Purchases End LONDON (MaceNews) – The European Central Bank surprised forecasters, announcing a reduction in asset purchases over the second quarter and raising the possibility of a rate hike this year, following the conclusion of Thursday’s governing council meeting. Purchases under the long-running Asset Purchase Programme will […]
FOMC Set to Proceed ‘Carefully’ on Road to Tighter Monetary Policy, But Ultimate Destination Unclear
– Must Decide Pace of Rate Hikes, Where Neutral Is, and Whether Neutral Is High Enough – Fed Getting Closer to Balance Sheet Reduction But Funds Rate Primary Policy Tool By Steven K. Beckner (MaceNews) – It seemed virtually a foregone conclusion that the Federal Reserve would start raising short-term interest rates in mid-March after Jerome Powell’s […]
Bank of Canada’s Macklem: Won’t Rule Out 50 bp Rate Hike in Future If Needed
–BOC Governor: To Tighten Policy ‘In a Deliberate and Careful Way’ By Max Sato (MaceNews) – Bank of Canada Governor Tiff Macklem said Thursday that he won’t rule out the possibility of the bank raising the policy interest rate by a faster pace of 50 basis points than its decision Wednesday to conduct the first […]
Fed’s Powell Will Ask for 25 bp Rate Hike March 16; First Of ‘Series’ of Rate Hikes
– But FOMC Will Withdraw Monetary Stimulus ‘Carefully’ To Avoid ‘Adding Uncertainty’ – Ultimate Aim is ‘Neutral’ Rate of 2-2.5%; Perhaps Higher; Must Act ‘With Care’ By Steven K. Beckner (MaceNews) – Russia’s invasion of Ukraine will not prevent the Federal Reserve from beginning to raise interest rates in two weeks, but it will make the Fed more cautious about withdrawing monetary […]
Bank of Canada Hikes Policy Rate To 0.50% From Record Low 0.25% To Fight Inflation
–BOC Keeps Reinvesting in Government Bonds on Its Balance Sheet –BOC: Russia’s Invasion of Ukraine ‘A Major New Source of Uncertainty’–BOC: Expect Further Rate Hikes As Economic Growth, Inflation Pressures Continue –BOC: To Consider Start of Quantitative Tightening Based on Economic Assessment By Max Sato (MaceNews) – The Bank of Canada on Wednesday raised its […]
NY Fed’s Williams Nixes 50 BP March Hike in Federal Funds Rate
– ‘No Compelling Argument’ For Big Move In the Beginning of Firming Process – Affirms Market Expectations of ‘More Normal’ Funds Rate of 2-2.5% by end 2023 – MBS Sales Should Only Be Considered ‘Down The Road’ – ‘Confident’ Fed ‘Can Manage the Soft Landing’ By Steven K. Beckner (MaceNews) – New York Federal Reserve […]
Chicago Fed’s Evans: Monetary Policy ‘Wrongfooted, Needs Substantial Adjustment’
– Expects Inflation to Drop; Still ‘Well Anchored at 2%’ – ‘No Extra Monetary Restraint Needed to Bring Inflation Down’ By Steven K. Beckner (MaceNews) – Chicago Federal Reserve Bank President Charles Evans predicted Friday that inflation will fall from its current rapid pace and said he doesn’t think the Fed will need to be […]
BOJ Moves to Defend 10-Year JGB Yield’s 0.25% Ceiling as Bonds Sold on Fed Tightening Mode
By Max Sato (MaceNews) – The Bank of Japan sent a clear message to financial markets late on Thursday that it is not following other major central banks in shifting gears toward tightening by announcing that it is conducting an unlimited fixed-rate long bond buying operation at 0.25%, the upper limit of its guidance range. […]
Cleveland Fed’s Mester: Should Reduce Balance Sheet Soon, Faster Than Last Time
By Steven K. Beckner (MaceNews) – Expressing heightened concern about inflation, Cleveland Federal Reserve Bank President Loretta Mester called Wednesday for an early and relatively rapid firming of monetary policy. Mester, a voting member of the Fed’s policy making Federal Open Market Committee this year, said she favors starting to raise the federal funds in […]
ECB Sounds More Hawkish Note But Leaves Policy Unchanged
— President Christine Lagarde Acknowledges that Inflation is More Likely to Overshoot Target (MaceNews) – The European Central Bank “will not be complacent” about record-high eurozone inflation, a more hawkish stance from ECB President and long-term dove Christine Lagarde Thursday. “Compared to December, inflation risks are tilted to the upside, particularly in the near term,” […]