Three Fed Officials Start Prepping Market For Post Stimulus Economy

July 17, 2014 Share Print 0

In the last week, three vocal Federal Reserve officials have been urging their colleagues to stop filling up the proverbial punch bowl.

Not only do they want the Fed to stop buying bonds (there’s already a plan in place to eliminate those as early as October) — they also want the central bank to raise its short-term interest rate sooner than investors are expecting.

This isn’t just economist talk. Doing so could raise the rates on everything from mortgages and small business loans, to credit cards and auto loans, thereby tightening financial conditions throughout the U.S.

“I believe the time to dilute the punch is close upon us,” Dallas Fed President Richard Fisher said in a speech at the University of Southern California on Wednesday.

via CNN

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Alfonso Esparza

Senior Currency Analyst at Market Pulse

Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.