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20 Feb 2014
Flash: FOMC to continue QE taper - Societe Generale
FXStreet (Barcelona) - Kit Juckes, Global Head of Currency Strategy at Societe Generale, expects the Fed's pace of tapering to stay unchanged despite the weather issues in US.
Key Quotes
"FOMC minutes confirm that it would take a significant slowdown in the pace of US growth to make the Fed divert from a gradual slowdown in the pace of its bond purchases. At 2.7% 10-year note yields remain locked in mid-range and while US economic data has been weak, it is reasonable to blame the weather in part, and all we can do is wait and see what Spring gives."
"All of this, taken together, is risk-friendly enough as calmer emerging markets and an uptrend in the S&P show. And yet, there is some angst around this morning, in large part courtesy of another fall in China's HSBC/Markit PMI, to 48.3 from 49.5. The Chinese New Year can make a mess of some of the data, but even so, this was a weak enough outcome to support the view that the trend to weaker growth continues and that will keep risk appetite subdued."
Key Quotes
"FOMC minutes confirm that it would take a significant slowdown in the pace of US growth to make the Fed divert from a gradual slowdown in the pace of its bond purchases. At 2.7% 10-year note yields remain locked in mid-range and while US economic data has been weak, it is reasonable to blame the weather in part, and all we can do is wait and see what Spring gives."
"All of this, taken together, is risk-friendly enough as calmer emerging markets and an uptrend in the S&P show. And yet, there is some angst around this morning, in large part courtesy of another fall in China's HSBC/Markit PMI, to 48.3 from 49.5. The Chinese New Year can make a mess of some of the data, but even so, this was a weak enough outcome to support the view that the trend to weaker growth continues and that will keep risk appetite subdued."