The maths doesn’t really add up. Bullard isn’t on the FOMC and QE will be over by the time he does, so his call is a strange one.
At the moment bonds have taken the bait with US 10’s pushing up to a high of 2.15%, but falling back to 2.12%. It’s pretty much a similar story along the curve.
US 10 year bond yields 16 10 2014
I don’t believe a word of it coming true as the Fed aren’t going to go backwards now. They set the train going and there’s nothing substantial that should derail it. There’s more chance of announcing a whole new QE program than there is of not ending this one.
What Bully has done though is stick a big fat question mark in the mind of the market. He’s basically shown the stoppy child a wrapped present not to be opened until the next FOMC meeting on the 28th October.
That’s when QE is going to come to an end
….or is it?
