The Breakdown cover image

The Fed Crushes the Idea of a UK-Inspired Pivot

The Breakdown

00:00

The Bank of England's Intervention in Bond Markets

The British pound was down 3.5% the day the new government announced their economic plan, which is one of its five biggest daily dips in the last few decades. Bond prices, and thus the yield curve, reflects the stance of monetary policy. When it gets out of line with the Bank of England's monetary policy stance, sooner or later they will intervene to bring interest rates back into line. The Fed had a slight rally on Wednesday, but by the end of the week, that hope had faded. In any case, in this bad news is good news environment, markets are starved for morsels of hope.

Play episode from 01:51
Transcript

The AI-powered Podcast Player

Save insights by tapping your headphones, chat with episodes, discover the best highlights - and more!
App store bannerPlay store banner
Get the app