Those expecting new revelations as to where Federal Reserve policy
is heading when chairman Ben Bernanke delivers his semiannual monetary
policy report to Congress Tuesday may come away disappointed.
With the U.S. economy languishing and job creation anemic, Fed watchers and investors alike will be keen to hear what it will take for the central bank to ease monetary policy further in an effort to spur economic growth.
With the U.S. economy languishing and job creation anemic, Fed watchers and investors alike will be keen to hear what it will take for the central bank to ease monetary policy further in an effort to spur economic growth.
“Investors
will be looking for signs that (Bernanke) is considering more QE,”
Lawrence Creatura, portfolio manager at Federated Investors said.
QE refers to quantitative easing where the Fed buys bonds outright in order to inject more money into the economy and bolster growth.
“I
think he has been doing an excellent job of speaking softly and
carrying a big stick and that strategy has worked well for him,”
Creatura said. “The fact that he has the ability to do (QE3) will keep
investors hopeful. The Fed only has one bullet left in the gun and
incremental rounds of QE are less effective…so being able to have the
same effect verbally is valuable.”
Read more: http://www.cnbc.com/id/48200299
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