Tag Archives: Federal Reserve
The Fed’s Corporate Bond Purchases and Their Impact on Corporate Bond Issuance
In response to COVID-19 and its disruptive impact on the credit market, the U.S. Federal Reserve announced the creation of the Primary Market Corporate Credit Facility (PMCCF) and the Secondary Market Corporate Credit Facility (SMCCF) on March 23, 2020, to support the functioning of the credit market. The PMCCF provides a funding backstop for corporate…
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Assessing Gold’s Ascent
What’s driving demand for gold this year? S&P DJI’s Jim Wiederhold and CME Group’s Blu Putnam explore what’s pushing gold prices up and how investors are putting the precious metal to work in portfolios.
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Like the Virus, Credit Spreads Could Be at Risk of a Possible Second Wave
Ever since the Fed released its tsunami of credit, credit markets have rallied the most since the depth of the Global Financial Crisis. Continued central bank actions have driven the already existing trend toward demand for higher-yielding assets, helping companies issue debt with fewer lender safeguards and covenants. With the Fed willing to support the…
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Increased Supply of U.S. Treasuries and Interest Rate Risk
Since March 2020, the federal government has enacted four pieces of legislation to assist businesses and individuals weather the economic downtown triggered by the COVID-19 outbreak. According to the Congressional Budget Office (CBO), these four pandemic-related laws are projected to increase the federal deficit by USD 2.2 trillion in fiscal year 2020 and by USD…
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Rising Rates Arrive
Which of the figures below belong together? It’s obvious, even if analogies aren’t your strong suit, that A is like C and B is like D. A and C are not like B and D. The economic relevance of this simple visual exercise is this: At its March 2017 meeting, the Federal Open Market…
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2017, defensive strategies, equities, Equity, Factor, Fed Funds Rate, Fed Policy, Fed Rate Policy, Federal Funds Target Rate, Fei Mei Chan, high beta, Higher Interest rates, Index Investment Strategy, institutional investor, interest rates, low volatility, Raising Fed Funds, rising rates, risk, S&P 500, S&P 500 (TR), S&P 500 High Beta Index, S&P 500 Low Volatility, S&P 500 Low Volatility High Dividend Index, smart beta, stock, U.S. Federal Reserve
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Bank Lending: More Demand, Tighter Standards
Three times a year the Federal Reserve surveys bank lending officers about credit standards, loan pricing and the demand for borrowing. The Survey provides insights into business and consumer borrowing as well as where the economy may be headed. The results of the July 2016 survey, released today, echo the details in last week’s GDP…
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Countdown to Tomorrow
Tomorrow the Federal Reserve is expected to raise its benchmark Federal Funds rate by 25 basis points — the first increase in seven years. This increase, assuming that it comes, must surely rank among the Fed’s most advertised and anticipated moves ever, and Wall Street trading desks are ramping up in expectation of heightened trading volumes. We have…
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Food Price Inflation and El Nino Possibility
Food price inflation is increasing sharply in the US. Only last December 2013, food prices were just 1.05% higher than the previous December. As of May 2014, food price inflation was running at 2.46% (year over year) and possibly heading above 4% by late 2014 or early 2015. Now, the Federal Reserve (Fed) prefers to…
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Index of Leading Indicators Kicks-Off the Week
The yield on the 10-year Treasury as measured by the S&P/BGCantor Current 10 Year U.S. Treasury Index suddenly moved higher to 2.78% from the previous day’s 2.64%. Thursday’s upward movement before the Good Friday Holiday was a result of negotiations over the Ukraine crisis possibly resulting in an accord to defuse the conflict. Yields in…
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Fixed Income Update: Presidents’ Day Week
A short week ahead due to yesterday’s President’s Day Holiday. Treasuries gained today as the Empire Manufacturing report released today was a 4.48. The survey of manufacturing executives was bearish when compared to the expected number of 8.5 and its prior number of 12.51. February’s home builder’s sentiment was also lower as the National Association…
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