Reuters have an article saying that
(recent) developments have eroded the conviction of most Fed watchers that the U.S. central bank would start backing off its $85-billion-a-month bond buying program… at its September 17-18 meeting.
- The prospect of Western military action against Syria
- Emerging markets have sold off
- Oil prices have soared to six-month highs
- Another potential showdown over the federal debt ceiling limit is looming
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Hmm. I’m not privy to the workings of the Fed, but I am in the camp that a taper is coming in September, that ” the burden is on the economy to prove why the Fed should not taper“.
To the 4 points made above:
- Yep, and it will be limited
- Yep, especially those emerging markets with with large trade imbalances and foreign borrowings (relying on short-term foreign money to fund trade deficits) … and the Fed can’t be responsible for this
- Yep, they have. And they’ll come back down again soon enough
- Yep, it is looming, we’ve know this was coming for months now.
Alternative thoughts, views, welcome as always.
