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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
FED
Ahead of today's March FOMC minutes release, sell-side analyst expectations have coalesced around a $90-100B terminal monthly pace of balance sheet reinvestment caps.
- That's in line with double the $30B T / $20B MBS terminal caps in the 2017-19 QT program.
- The range of terminal cap expectations goes from $60B to $105B.
- The proportion of Tsy/MBS varies slightly, but generally 2/3 Tsy and 1/3 MBS.
- Almost all analysts see announcement and implementation in May.
- The cap size ramp-up period is seen taking 3 months (in 2017-19, they rose from $10B to $50B over 12 months, with a $10B increase each quarter).
- Only a couple see bills being allowed to run off the balance sheet.
- Outright asset sales are seen as being a fairly distant prospect, with the earliest start being 2023 (and for MBS, not Treasuries).
Source: MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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