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Barclays economists eyed the recent FOMC....>

US VIEW
US VIEW: Barclays economists eyed the recent FOMC statement and said they "read
the language on balance sheet policy as pointing to an announcement at the
September meeting. The committee stated that "for the time being," it continues
to reinvest principal payments from its securities holdings, but "expects to
begin implementing its balance sheet normalization program relatively soon"
(versus "this year" previously)."
- They add that "while the use of "soon" might be more appropriate given the
committee's desire to begin shrinking the balance sheet, "relatively soon"
provides flexibility to delay any announcement should the debt ceiling, or other
fiscal policy concerns, rattle markets ahead of the September meeting. We see
this as a low outcome and expect FOMC communications in the intermeeting period
to signal that a change in balance sheet policy is forthcoming."

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