U.S. President Donald Trump opened the door to blacklisting people and entities doing business with North Korea, further tightening the screws on Pyongyang's nuclear and missile programs.
Besides, and nearly unnoticed by markets, Fed balance sheet reduction has already and very gradually been taking place through U.S. commercial banks, which have reduced their excess reserves by roughly United States dollars 500 billion since 2014. But he has also said he is considering other candidates, notably Gary Cohn, head of Trump's National Economic Council.
As a effect, we continue to expect two 0.25% Fed funds rate hikes until the end of 2018, namely one in December of this year and one next June. The Bank of Japan is likely to maintain its so-called yield curve control policy, where it targets certain interest rates in the bond market through asset purchases, at Thursday's meeting. We believe that long rates would move up more dramatically if the Fed's current stance was too accommodative, and that current levels support our thesis that the central bank's policy stance may be closer to neutral than many observers believe.
The yield on the USA 10-year was at 2.2192% from 2.2298%.
According to Fed officials' projections, the core PCE index is expected to rise 1.5% this year and 1.9% next year, lower than the 1.7% and 2% forecasts in June.
And the Fed's balance sheet isn't the only one that will be unwinding over the next half-decade; indeed, it's not even the biggest. As the bonds mature, the government pays the face value to the Fed.
Municipals end weaker after FOMC leaves rate steady
Fed officials say they also foresee a slightly slower path for rate hikes in 2019.
"It's very likely to be initially greeted with a collective yawn from markets, if only because it has been so well choreographed", said Aaron Kohli and Ian Lyngen, interest-rate strategists for BMO Capital Markets, in a note to clients.
The Fed has been at pains to avoid a repeat of 2013's "taper tantrum", when its announcement it would start reducing the amount of bonds it bought sparked a sell-off in the financial markets.
Yellen declined to comment on the likelihood of her getting a second term and said she hasn't met the president in some time. After leaving its benchmark rate at a record low for seven years after the 2008 crisis, the Fed has modestly raised the rate four times since December 2015 to a still-low range of 1 percent to 1.25 percent.
But the central bank has been going backward in trying to meet its other mandate of stabilizing prices at an annual inflation rate of 2 percent over time. Quantitative easing has no doubt had some influence on long-term rates, and the market reaction to the upcoming reversal of policy will provide more information on the future course of rates.
By 1600 GMT the rand had weakened 0.2 percent to 13.3375 per dollar, its weakest since August 15.
Under the plan the Fed announced in June, it will start to allow a slight $10 billion in holdings to roll off the balance sheet each month - $6 billion in Treasurys and $4 billion in mortgage bonds.
Original pitch for X-Men: First Class sequel would've featured young Wolverine
And on Days of Future Past , even though I co-wrote the bloody thing, the reason I bailed out of it is two things", Vaughn said. But the second reason has less to do with the business side of filmmaking and a whole lot to do with story. "It's brilliant.
- IPhone X production has still not begun
- Flesh Eating Disease Affecting Victorians At An Alarming Rate
- Pair jailed for planting bomb at police recruitment drive
- PyeongChang 2018 Medals Unveiled
- Iran's Khamenei slams Trump's 'gangster and cowboy' speech
- CICC Jumps 17% After Tencent Acquires 5% Stake
- Global trade 'rebounds strongly' in first half of 2017: WTO
- WisdomTree MidCap Dividend ETF (DON) Rises 0.01% for Sep 20
- Liverpool star Adam Lallana running for the first time since injury
- Brendan Rodgers kept Raheem Sterling on £2k a week Liverpool contract