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UPDATE 2-Fed shock decision not to taper QE was 'close call' -minutes
2013年10月9日 / 晚上7点00分 / 4 年前

UPDATE 2-Fed shock decision not to taper QE was 'close call' -minutes

* Most participants still saw reduction in bond buys this
    * Minutes underscore divisions at Fed as Obama picks Yellen
to lead
    * Government shutdown, debt ceiling debate clouds outlook
for policy

    By Jonathan Spicer and Ann Saphir
    NEW YORK/SAN FRANCISCO, Oct 9 (Reuters) - The Federal
Reserve's shock decision last month not to reduce its support
for the U.S. economy was a "relatively close call" for
policymakers, according to minutes of the meeting that also
showed there was still broad support to trim bond-buying this
    Since last month's meeting, the outlook for scaling back
bond purchases has grown cloudier.
    A budget battle in Washington hit a stalemate and forced a
partial government shutdown that started this month, threatening
economic growth and depriving the Fed of official economic data
to drive its decisions. 
     The minutes of the Fed's Sept. 17-18 meeting, released on
Wednesday, clearly showed top officials were concerned their
decision to keep buying $85 billion in bonds each month could
muddle their messaging with investors who largely expected a
    At the conclusion of the much-anticipated meeting, the
decision of the Fed's policy-setting Federal Open Market
Committee sparked a global stock market rally and depressed the
U.S. dollar. 
    "For several members, the various considerations made the
decision to maintain an unchanged pace of asset purchases at
this meeting a relatively close call," the minutes said of the
10 voting FOMC members.
    Referring to the broader group of 17 Fed policymakers, the
minutes said, "most participants judged that it would likely be
appropriate to begin to reduce the pace of the Committee's
purchases of longer-term securities this year and to conclude
purchases in the middle of 2014."
    Now that the government shutdown has entered its ninth day,
whether policymakers continue to back tapering this year is an
open question. 
     "The political landscape has undoubtedly worsened," said
Jacob Oubina, senior U.S. economist, RBC Capital Markets, New
York. "Recent talk from Fed speakers and the political situation
should push tapering out until 2014." 
    In June, Fed Chairman Ben Bernanke primed markets to expect
a cut to the quantitative easing program (QE) when he said the
central bank expected to make its first policy move later this
year. Yields on U.S. Treasury bonds then mostly rose through the
summer in anticipation of a September cut. 
    The minutes, which briefly lifted U.S. stocks to session
highs on Wednesday, said Fed policymakers raised concerns about
"the effectiveness of FOMC communications if the Committee did
not take that step."
    They also worried it might be difficult to explain a cut to
QE "in coming months absent clearly stronger data on the economy
and a swift resolution of federal fiscal uncertainties," the
minutes show.
    After the September meeting, Bernanke said the Fed wanted to
see more evidence of solid economic growth before trimming the
bond-buying, which was launched a year ago and is meant to spur
investment, hiring and economic growth. 
    Bernanke also emphasized policymakers were not on a preset
course to reduce the program this year, but would do so only if
the job market improved.
     U.S. President Barack Obama on Wednesday nominated Fed Vice
Chair Janet Yellen to succeed current Fed Chairman Ben Bernanke,
in a move that investors welcomed because it suggests policy
    But the minutes underscored how deeply divided policymakers
are, and may yet be if Yellen is confirmed by the Senate as
expected and takes the seat at the head of the policy-setting
table early next year. On Wednesday, she said it was important
that Fed policymakers "vigorously debate, then unite" behind any
given policy response.
    The minutes, in typical dry tones, spotlighted the vigor of
the debate, if not the unity of the response.
    Some members pointed to mixed economic data, low inflation,
and uncertainty over fiscal policy to back their preference "to
await more evidence that their expectation of continuing
improvement would be realized" before proceeding with a
reduction in bond purchases. 
    Other participants in the discussion, including non-voting
members, interpreted the data as consistent with an improving
labor market, and urged a small reduction in bond-buying to
follow through with Bernanke's signaled plan. A few of those
said they preferred to scale back Treasuries purchases, which
make up $45 billion of the monthly buying program.
    Since Oct. 1, when the government shutdown began, the Fed's
ability to gauge the state of the economy has been somewhat
impaired. For instance the latest read on the nation's
unemployment rate, 7.3 percent, dates from August; September's
figure would normally have been released last week.  
    The standoff also threatens to slow the economy further as
government workers lose income and investors fret about whether
lawmakers will precipitate a national debt default if they do
not raise the U.S. debt limit by Oct. 17, when the government is
expected to run out of money to pay its bills.

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