Fed’s willingness to buy bonds still under the microscope
The U.S. central bank bought $2.2 billion in debt maturing from 2021 to 2040. See buyback results.
Speeches from Fed officials on Wednesday “altered the pricing of a shock and awe outcome to a more calculated response ‘if needed’ at the next FOMC get together,” said John Spinello, bond strategist at Jefferies & Co. Read about Fed officials’ comments.
“QE speculation continued and with five weeks to the next meeting, it should provide an erratic atmosphere as the market tries to dissect each and every comment from each and every Fed official in evaluating the pros and cons,” Spinello said.
After its Sept. 21 meeting, the FOMC implied QE will be very data-dependent, saying it “is prepared to provide additional accommodation if needed to support the economic recovery.”
