Fed’s Williams sees calm market reaction to balance sheet unwind

U.S. central banker John Williams said on Friday he does not expect market turbulence as the Fed gets under way with reducing its huge balance sheet.

“I don’t anticipate any sudden or large effects on rates or spreads or things like that as we normalize,” Williams, president of the San Francisco Federal Reserve, told reporters in Zurich.

“Obviously we’ve talked about this endlessly. We’ve announced it and the markets have totally taken this in stride. But it’s still an open question as we actually implement this next month and over the next several years, how will markets react? We’ll obviously be following that very carefully.”

Reuters

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell