LONDON | By Barclays analysts | We now expect Fed to taper in March 2014. The September payroll report was on the soft side, with nonfarm payrolls rising 148k and private payrolls rising only 126k. These numbers were below our (200k) and consensus (180k) expectations for headline payroll growth. In light of the moderate tone of the September employment report, we have pushed out our expectation for the first Fed tapering in the pace of asset purchases to March 2014 from December 2013.
SAO PAULO | By Marcus Nunes | It is a common occurrence with sports idols and some teen idols to be demonized in the next stage of their lives. But among Fed Chairmen, Alan Greenspan surely gets the ‘honor’ of being the first.
MADRID | By Francisco López | The change in the Fed’s plans regarding the withdrawal of monetary stimulus is another consequence of the political row between Democrats and Republicans.
SAO PAULO | By Marcus Nunes | The fact that Ms Yellen is a dove today does not imply that she would tolerate rising inflation tomorrow. She will need to persuade the markets, and the public, of that in the coming weeks.
THE CORNER | As expected, U.S. President Barack Obama appointed Janet Yellen as the Federal Reserve’s next leader, the first woman in the 100-year-history of the central bank. Among her first words: “More needs to be done to strengthen the recovery,” even though progress has been made, and: “too many Americans still cannot find a job and worry how they will pay their bills and provide for their families.” Were those hints about how she will deal with QE? Although she is considered a dove, some analysts believe that is a bit overstated. Anyway Obama called her “tough”, joking that it was not just because she was born in Brooklyn.
NEW YORK | By Ana Fuentes | If the Senate agrees and everything goes by the script, President Obama will pick Janet Yellen as the Federal Reserve’s next leader on Wednesday, the White House said. Ms. Yellen, 67, has been the Fed’s vice chairwoman since 2010 and would be the first woman to run the central bank. Among her first tasks is how quickly to wind down the U.S. expansionary monetary policy. Will she take even more aggressive measures to boost growth? If so, how will markets react?
SAO PAULO | By Marcus Nunes | ‘Uncertainty’ is getting more and more attention. John Taylor is a great supporter, so much so that a while back I did a post with the title “Taylor´s Uncertainty Principle”, and argued that what was really keeping the recovery back was the “on and off” decisions by the Fed.
NEW YORK | By Ana Fuentes | The U.S. Federal Reserve has been the talk of the town for weeks because of the tapering soap opera. But how much do we really know about the central bank on its centennial anniversary? An exhibit called “The Fed at 100” opened this Wednesday in New York, aiming to explore the Fed’s pivotal role throughout the history of American finance. And -that’s what we preferred- its response to economic crises.
MADRID | The Corner Team | Spain’s borrowing costs dropped at a double bond auction on Thursday after the U.S. Fed announced it will not start tapering yet. The 3-year bonds were sold at an average yield of 2.225%, compared with 2.636% seen at the previous auction. Madrid expects that this will leave some margin to offset possible negative deviations elsewhere or to better fulfill the country’s deficit target (6.5% for 2013).