TD Securities’ Gennadiy Goldberg and Molly Brooks analyze the Federal Reserve’s decision to halt Reserve Management Purchases (RMP) after tapering from $40bn to $10bn per month. They argue the pause reflects soft money market rates and an ample reserve buffer, not imminent Quantitative Tightening (QT), and expect RMP to resume at a reduced pace in November 2026 before any balance sheet changes in 2027.
Fed pauses RMP, QT seen distant
“Markets may worry that this is the first step on the road back to Quantitative Tightening (QT), but we believe the halt will be temporary and purchases will resume in November to help smooth over money market…
Read the full article at FXSTREET.COM
