US DATA: Nov 2-3 FOMC mins disclose an Oct 15 videoconf where FOMC
discussed communication, QE and a term rate target. “In their discussion
of the relative merits of smaller and more frequent adjustments versus
larger and less frequent adjustments in the Federal Reserve’s intended
securities holdings, participants generally agreed that large
adjustments had been appropriate when economic activity was declining
sharply in response to the financial crisis. In current circumstances,
however, most saw advantages to a more incremental approach that would
involve smaller changes in the Committee’s holdings of securities
calibrated to incoming data. Finally, participants discussed the
potential benefits and costs of setting a target for a term interest
rate. Some noted that targeting the yield on a term security could be an
effective way to reduce longer-term interest rates and thus provide
additional stimulus.” But potentially large risks incl Fed “might find
itself buying undesirably large amounts of the relevant security in
order to keep its yield close to the target level.”