Federal Reserve Chairperson Jerome Powell: Slowing down balance sheet reduction means it will happen at a slower pace, but for longer.
Federal Reserve Chairperson Jerome Powell said that the balance sheet is still shrinking and liquidity is still abundant; it will pay attention to the situation in the reserve market, and when market conditions slightly exceed'sufficient ', the Federal Reserve will try to stop the shrinkage of the balance sheet.
On January 30, Federal Reserve Chairperson Jerome Powell hinted at a press conference that the Federal Reserve still has room to operate in reducing the size of its balance sheet. He said that reserves in the banking system are still "abundant" and the Federal Reserve still has solid control over the federal funds rate. As for when the Fed should stop shrinking its balance sheet, Powell said: "I have nothing to say about a specific date."
Goldman Sachs forecasts that the Federal Reserve will stop shrinking its balance sheet (QT) in the first quarter of 2025.
The shrinking PMI has pushed US bond yields below a key threshold. Analysts pointed out that the impact of tonight's non-farm data on US bonds is... > >
The boom in Internet celebrity stocks shows that the US financial system is still abundant in liquidity, and the Fed's slowdown in shrinking its balance sheet means that the balance sheet will never normalize; it is expected that the Fed's dot plot next week will still suggest two interest rate cuts this year...