Central Bank To Announce Their Decision at 2 pm EST
The Federal Reserve is poised to reveal the status of their $85 billion/month bond buying campaign later today at 2 pm EST.
Remember four to five months ago when it seemed like a virtual certainty that the Federal Reserve would start "tapering" their bond purchases by the fall, with an eye on scaling back to zero in 2014?
The Federal Reserve surprised most everyone by keeping their bond purchases steady at $85 billion/month in September, as the general perception was that there were going to start scaling back at that point. The economy has since shown signs of slipping, so the move by the Federal Reserve is looking like a shrewd one.
The numbers will likely look even worse when the impact of the short government shutdown is fully reflected in the economic data. We've already seen consumer and business confidence numbers that showed a rattled US population due to the battle over the government shutdown and debt ceiling situation.
Due to the negative impact over the government shutdown/debt ceiling battle, everybody is expecting that the Federal Reserve will sit tight and announce a continuation of their bond buying program later today. In fact, the general consensus seems to be that it will be at least March of 2014 before the Federal Reserve starts tapering their purchases.
In terms of interest rate hikes, don't expect anything on that front for a couple of years, at least.
Filed under: General Knowledge