23 Dec 2013
Flash: Fed strengthens forward guidance - BTMU
FXstreet.com (Barcelona) - Lee Hardman, FX Analyst at the Bank of Tokyo Mitsubishi UFJ notes that the Fed’s decision to also strengthen its forward guidance signalling that its key policy rate will remain unchanged until well after the unemployment rate reaches 6.5% combined with further evidence that the outlook for the US economy is brightening has helped to reassure investors that a gradual tapering of QE by the Fed is well timed.
Key Quotes
“The clear timetable set out by the Fed signalling that it intends to slow the pace of QE by USD10 billion at each meeting next year bringing to an end by late 2014 has provided further clarity to policy making in the US next year after the US government also agreed spending plans.”
“The developments prompted IMF Managing Director Christine Lagarde to state that the IMF is likely to raise its real GDP growth outlook for the US economy next year from their current projection of 2.6%, with the upward revision likely to be officially announced in January.”
Key Quotes
“The clear timetable set out by the Fed signalling that it intends to slow the pace of QE by USD10 billion at each meeting next year bringing to an end by late 2014 has provided further clarity to policy making in the US next year after the US government also agreed spending plans.”
“The developments prompted IMF Managing Director Christine Lagarde to state that the IMF is likely to raise its real GDP growth outlook for the US economy next year from their current projection of 2.6%, with the upward revision likely to be officially announced in January.”