Quantitative Easing Exit Begins At LastComments Off on Quantitative Easing Exit Begins At Last
2013 came to a close with the US Federal Reserve finally putting investment markets out of their misery.
When Ben Bernanke, the chairman of the US Federal Reserve, started talking about the tapering of quantitative easing (QE) last May, the markets reacted badly. It was not that anyone expected bond buying by the US central bank to carry on buying government and mortgage-backed bonds at the rate of $85bn a month for ever, it was just that there were serious doubts about what an end to QE would bring. May’s speech suggested the taper would start in September, but it was put on hold, allegedly because of concerns about the budgetary battles on Capitol Hill. That was another surprise, but not an unsettling one. (more…)