Stocks, Dollar, & Bond Yields Sink After Fed Warns “Tighter Monetary Policy Than Otherwise Is Warranted”

Wednesday, August 16, 2017
By Paul Martin

by Tyler Durden
Aug 16, 2017

The initial reactions wre modest but directionally ‘correct’ given the dovish bias to the Fed Minutes – stocks are up, bonds are up (lower in yield), and the dollar is down. But then traders read the warnings that due to excessively easy financial conditions, “a tighter monetary policy than otherwise was warranted.” and stocks sank.

There were 3 dovish quotes:

1. “Many participants, however, saw some likelihood that inflation might remain below 2 percent for longer than they currently expected, and several indicated that the risks to the inflation outlook could be tilted to the downside.”

2. “Participants agreed that a fall in longer-term inflation expectations would be undesirable, but they differed in their assessments of whether inflation expectations were well anchored.”

3. “Most Fed officials saw wage-price framework still valid”

And bonds and the dollar were following that bias…

The Rest…HERE

Leave a Reply

Join the revolution in 2018. Revolution Radio is 100% volunteer ran. Any contributions are greatly appreciated. God bless!

Follow us on Twitter