Real Vision: Finance & Investing Is The Fed Done?
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Nov 3, 2023 The podcast discusses the Fed being done with interest rate hikes, the impact of treasury yields trending higher, the potential of crypto, and the Bank of Japan's yield curve control policy.
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Fed Done Hiking Rates
- The Fed is likely done hiking rates due to supportive data and higher long-term yields acting as a substitute.
- Inflation trends lower and labor market softening support this, alongside a global economic slowdown.
Treasury Issuance Strategy Stabilizes Yields
- Treasury's shift to issuing more short-term bills and fewer long-term coupons stabilizes yields.
- This maneuver caters to current high demand for bills and reduces long-end supply pressure.
Rising Treasury Yields Ahead
- Treasury yields have likely peaked for the year but face upward pressure long-term due to massive supply.
- Without spending cuts or Fed intervention like yield curve control, yields must trend higher over time.