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Not-QE or just don't call it QE?

Not-QE (no Quantitative Easing) or just don't call it QE? According to Zerohedge, the US central bank announced it would start purchasing $60BN in Bills per month starting October 15. This will be in addition to rolling over "all principal payments from the Federal Reserve's holdings of Treasury securities and the continued reinvestment all principal... Not-QE or just don't call it QE?
Not-QE (no Quantitative Easing) or just don't call it QE?

According to Zerohedge, the US central bank announced it would start purchasing $60BN in Bills per month starting October 15. This will be in addition to rolling over "all principal payments from the Federal Reserve's holdings of Treasury securities and the continued reinvestment all principal payments from the Federal Reserve's holdings of agency debt and agency mortgage-backed securities received during each calendar month."

But wait there's more, because just as today's surprising spike in repo use suggested, mere "NOT A QE" may not cut it, and just in case, in order to provide an "ample supply of reserves", the Fed will continue with $75BN in overnight repos and $35 billion in term repos twice per week, "at least through January of next year."

Where the Fed's announcement differs from Goldman's proposed POMO schedule, is that this appears to be a far more aggressive form of "NOT A QE" because as the Fed notes it will continue well into the second quarter of 2020, meaning it will last beyond the 4 months proposed by Goldman, to wit: "in light of recent and expected increases in the Federal Reserve's non-reserve liabilities, the Federal Reserve will purchase Treasury bills at least into the second quarter of next year in order to maintain over time ample reserve balances at or above the level that prevailed in early September 2019."

The Fed's proposal indicates that between the continuation of repo operations, and the net $60BN balance sheet expansion, the Fed's balance sheet will reach roughly $4.2-$4.3 trillion some time in Q2 2020.

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Weekly review: Gold, USD, EURUSD and Dow Jones

Weekly review: Gold, USD, EURUSD and Dow Jones

Global markets ended last week on a positive note. Moving ahead, markets are expected to be volatile this week, with investors closely watching economic data and global events. The inventors are anxiously awaiting Wednesday’s decision by the Federal Reserve on interest rates along with ECB and BOE decisions on Thursday.