The Phili Fed survey is now showing that deflation is indeed now a real risk in the US economy. If the Fed hadn’t announced an extension of Operation Twist last night, I would have said that they would certainly be looking at additional stimulus as soon as possible. The Survey released today had more Mid- […]
“Hopium” still there — FIU
“Hopium” still there, but why when the FOMC are clear about what they expect. The FOMC announced that they are extending Operation Twist until the end of the year, beyond the expiry of next month. The FOMC therefore, to me, is ruling out any new form of Quantitative Easing, QE3, this year. The Equity markets […]
The Rout of Europe — FIU
European Bond Yields have risen dramatically in the past few weeks with a rout yesterday and it looks to continue today. This is the price action of the 30yr German Bund down 7 points in 2 days! – Why, what has happened? It’s not as if the market is expecting a positive announcement from the […]
Risk markets are betting all on Central Bank Liquidity Stimulus — FIU
The very weak US Employment data from Friday is being used as a reason to expect QE3 to be announced at the next FOMC meeting June 20th. Tonight’s Fed Beige Book will give us a better idea of the economic data that the Fed will be seeing, but yesterday two Fed governors , Bullard and […]
Betting on a return of the Deutsche Mark! — FIU
Betting on a return of the DeutscheMark! Whilst the news yesterday centered on the fall in US 10yr Treasury yields to levels not seen since 1946, the bigger news maybe that the new German 2yr Bond at one stage yesterday traded above 100. Given that the coupon on the Bond is zero percent than that […]