Last quote by Steven Englander
Steven Englander quotes
2017, the question would be does he do the Reagan-thing and emphasize tax cuts and getting the U.S. economy going? Or does he hammer the trade thing which I think would be very difficult for markets over an extended period.
No one knows the currency breakdown for sure. 80 percent in dollars sounds reasonable. So 20 percent of $2.5 trillion is a big number.
The dollar money would come back into U.S. equity markets quicker than the non-dollar cash. It would be very good for U.S. equity markets and would probably attract foreign money into the U.S., pushing up U.S. yields in a risk-friendly way. It would be very dollar-positive.
The unacknowledged elephant in the room may well be their desire to distance themselves from negative rates territory.
Despite all the caveats, the message they intended to send was that June was seriously live.
One of the new themes in markets is that (quantitative easing) has damaged the banks and that therefore it exacerbates the risk-off environment.
The key driver is this immense pessimism in asset markets, unwillingness to hold anything but the safest assets.
They have no incentive to pre-announce a June hike. It makes more sense for them to begin warning the market a month or so before they intend to hike so that it is largely priced in before it occurs and has less chance of being derailed by events that they can't control.
The difference between a hawkish Fed and a dovish Fed is the degree to which they open the door to a June, or much less likely, April hike.