30 Jan 2014
Flash: Fed taper unconcerned over EM jitters - BTMU
FXstreet.com (Barcelona) - Lee Hardman, FX Analyst at the Bank of Tokyo Mitsubishi UFJ notes that the Fed appear unconcerned over developments in Emerging Markets.
Key Quotes
"The US dollar has remained on a firmer footing in the Asian trading session following the Fed’s decision overnight to continue tapering QE by a further USD10 billion/month. From the beginning of February the Fed will now only purchase USD35 billion/month of long-term Treasury securities and USD30 billion/month of agency mortgage backed securities."
"The decision to slow asset purchases by a further USD10 billion/month was unanimous. In the statement the Fed acknowledged that economic activity had picked up in recent quarters although noted that labour market indicators were mixed but on balance showed further improvement."
"The Fed statement displayed no concern over recent developments in emerging markets which are likely judged at present as not posing a material downside risk to their economic growth or inflation outlook. The Fed will likely be pleased that the pick up in safe haven demand has helped to modestly lower US yields in early 2014 supporting economic growth even as the Fed has slowed asset purchases."
Key Quotes
"The US dollar has remained on a firmer footing in the Asian trading session following the Fed’s decision overnight to continue tapering QE by a further USD10 billion/month. From the beginning of February the Fed will now only purchase USD35 billion/month of long-term Treasury securities and USD30 billion/month of agency mortgage backed securities."
"The decision to slow asset purchases by a further USD10 billion/month was unanimous. In the statement the Fed acknowledged that economic activity had picked up in recent quarters although noted that labour market indicators were mixed but on balance showed further improvement."
"The Fed statement displayed no concern over recent developments in emerging markets which are likely judged at present as not posing a material downside risk to their economic growth or inflation outlook. The Fed will likely be pleased that the pick up in safe haven demand has helped to modestly lower US yields in early 2014 supporting economic growth even as the Fed has slowed asset purchases."