he Federal Reserve is expected to fine tune its policy message when it meets in the coming week, but whether it is able to rein in volatile financial markets is another matter. The two-day Fed meeting ends Wednesday with a statement, economic forecoast and a press briefing by Fed Chairman Ben Bernanke; it also follows a rough several weeks for markets, where interest rates have risen, forcing a reassessment and shaking out of asset values across global markets.
There is a heavy economic calendar, including housing and consumer level inflation data, but the focus is honed on what the Fed will say about its quantitative easing program and whether it will signal that it is going to start paring back on its $85 billion monthly bond purchases.
"I think it's time for them to establish some clarity," said Ward McCarthy, chief financial economist at Jefferies. "I think in terms of near-term balance sheet guidance and rate guidance, nothing will change. However, I think they will also add additional guidance that's specifically related to the timing and rate of the eventual wind down."
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