文档介绍：Macro Report
Fed Resorts to QE-lite in Face of Slowing Recovery
Comments on FOMC Statement in August
¾ As both the output and the pace of recovery have slowed down since Dr. Cliff ZHAO
June, the Fed got more pessimistic on the . economic recovery. In (852)31896126
view of the unsatisfactory employment, e and other slower wenlizhao@
growth and the impact of the credit crunch, the Fed believed that the
economic recovery in the short run will much slower than originally Qing LI
anticipated. (852)31896142
¾ In order to prevent further economic downturn, while announcing the qingli@
extension of maintaining low interest rates, the Fed decided to restart
the quantitative easing, reinvested the principal payment of agency debt Dr. David XIE
and mortgage-backed securities (MBS) into Treasury bills, thus prevent (86-755)82943724
the Fed’s balance sheet from shrinking, which is in line with xieyx@
expectations. At the same time, mission held that when the
bonds expire after the Fed will be extended. Through the above Research Department
approach, the Fed hopes to depress bond yields, thereby reducing bond CMS (HK)
yields as a benchmark for corporate bond yields, mortgage interest rates,
stimulate private consumption and investment recovery. The 13 August 2010
interest-rate decisions made by the meeting suggested that the dire