美国：美联储正常化才刚刚开始.pdfVIP

FOCUS | US Please refer to important information and 21 March 2019 MAR disclosures at the end of this report G10 INTEREST RATES US: Only the beginning of the end of Fed normalization Fed to start full SOMA reinvestment in Q4. The Fed KEY MESSAGES has finalized plans for the end of balance sheet The Fed will end balance sheet normalization in reduction, consistent with our expectations. The September, with full reinvestment to commence only monthly cap on UST roll-off will be halved to $ 15bn from October. from May. Net UST supply to the market will fall materially only from Q4. The Fed suggests reinvesting March’s big dovish revision to dots, balance sheet MBS prepayments into USTs across the curve. The announcement and little concern over upside inflation reinvestment plan remains subject to ongoing debate. risks reinforce our views of gradual curve steepening, Too little, too late? Despite the Fed’s announcement higher inflation breakevens and lower rates volatility (as to moderate reserves contraction from May, overnight the Fed attempts to shr