If there are signs of economic weakness by the late quarter of calendar 2020, the Fed will keep up with the bond buying.
Watch chatter on QE4. Some say that this chatter is boosting the DJIA and S&P 500.
The Fed is doing what investors think it’s doing.
2020 GDP growth is expected at 2.00 percent.
A CNBC/Moody’s survey put Q1 2020 GDP growth at 1.60 percent.
Contracting industrial production is a red flag. There is less demand for commercial and industrial loans.
The Fed seems to have laid the groundwork for more securities purchases. The Fed’s efforts to stabilize the overnight money markets may run through Q1 2020. Since September 2019 the Federal Reserve Bank of New York has been buying securities. Repurchase (“repo”) and reverse purchase (“reverse repo”) agreement to provide liquidity and keep overnight borrowing rates from spiking.
The Fed’s balance sheet is growing.
The Fed in QE hell. Source for this post.