• US Fed removes “accommodative” from September statement
• 2 year Treasuries get strong bid at 2.86%
Federal Reserve chairman Jerome Powell told the markets last week in his September statement that effectively interest rates are now, at 2.25%, in a sweet spot of where they should be, given the current state of the US economy.
“We see no great risk of inflation to the upside”, Powell stated. “We see very good signs in the economy but it’s not perfect”, which is why the Fed removed from its statement the word “accommodative”. There is no need anymore for the Central Bank to give a helping hand to the economy by doing a little extra to help it.
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