Bloomberg report on Goldman Sachs senior economist Zach Pandl:
Says (bolding is mine):
- Assets held in foreign reserve portfolios typically have a much shorter average maturity than assets the Federal Reserve bought during its rounds of bond purchases,
- So it takes a greater amount of selling in nominal dollar terms to have a similar impact in duration terms
- From 2010 until mid-2014, these central banks purchased the equivalent of $15 billion in 10-year U.S. Treasuries each month. Now they're selling about $34 billion worth per month.
That $50 billion net swing is roughly equivalent to the monthly purchases made by the Federal Reserve during its second round of bond purchases (QE2) - "It seems inconceivable that [U.S. dollar denominated asset sales] could approach the scale of the Fed's QE programs, which would require EM central banks to sell about $4.2 trillion in reserves (given their low duration), or about half of the current stock," he asserted.
So, QT ain't all its cracked up to be according to Pandl.
More at the link