12 Jul 2013
Flash: USD to enter bearish outlook? – BMO Capital Markets
FXstreet.com (Barcelona) - According to Stephen Gallo, at BMO Capital Markets, “The complicating factors surrounding the FOMC point to an aggressively bearish stance towards the USD.”
The highlight of the FOMC Minutes, i.e. labor gains needed before tapering can start, was that both markets and the Fed are essentially data-driven, and this is not any more or less than what Bernanke already told us on 19 June, 21 since both QE1 and QE2 were examples of highly accommodative Fed monetary policy, QE3 with gradual tapering is still therefore the same thing
Moreover, “Bernanke in his Q&A was clear that the rationale for a tapering timeline was to prevent financial markets from getting too caught up in speculative excess whilst failing to account for the fact that the current $85 billion per-month pace of asset purchases would be adjusted lower over time, and over what is now a known timeline.” Gallo reiterates.
The highlight of the FOMC Minutes, i.e. labor gains needed before tapering can start, was that both markets and the Fed are essentially data-driven, and this is not any more or less than what Bernanke already told us on 19 June, 21 since both QE1 and QE2 were examples of highly accommodative Fed monetary policy, QE3 with gradual tapering is still therefore the same thing
Moreover, “Bernanke in his Q&A was clear that the rationale for a tapering timeline was to prevent financial markets from getting too caught up in speculative excess whilst failing to account for the fact that the current $85 billion per-month pace of asset purchases would be adjusted lower over time, and over what is now a known timeline.” Gallo reiterates.