By Liz McCormick and Alex Harris Bloomberg News Tuesday, May 21, 2019
If you thought the Federal Reserve was done with quantitative easing, you might only be half right.
As soon as next year, analysts say the Fed will resume large-scale buying of debt securities -- this time just U.S. Treasuries -- in amounts that may ultimately exceed its crisis-era purchases. According to an estimate by Wells Fargo & Co., the central bank's balance sheet will rise past its historic peak as it adds over $2 trillion to its Treasury debt holdings in the next decade.
"For anybody that has been in the market for the last 10 years, it will feel like QE," said Priya Misra, global head of rates strategy at TD Securities. "Once again the Fed will be the single largest buyer of Treasuries and (this time) in a non-QE world. This will be a very bullish Treasury-market dynamic." ...
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