Fed Policy Outlook - Action Economics

Action Bullets

Fed Chairman Bernanke didn't break any new ground in Jackson Hole speech, merely reiterating Fed stands ready to support economy if needed
NY Fed has begun its outright purchases, which will now be couducted twice weekly
Fed surprised us with its August 10 policy statement, saying it will reinvest proceeds of maturing agency and MBS into Treasuries (and will roll over maturing Treasuries) to hold its balance sheet unchanged, putting its exit strategy on hold
Senior Loan Officer Survey reported banks eased standards and terms, due to competitive pressures, though demand for loans remained weak (16-Aug-10)
Fed nominees Yellen, Diamond, and Raskin approved by Senate Banking Committee (28-Jul-10)
Beige Book said economic activity increased, but Atlanta and Chicago noted some slowing (28-Jul-10)
Fed Chairman Bernanke, in his Monetary Policy Report (21-Jul-10), confirmed the slightly more dovish policy stance already seen in other policy statements
FOMC minutes to June 22, 23 policy meeting confirmed downgraded outlooks on near term growth, inflation, and employment, but didn't see need for further policy accommodation
Fed completed it three tests of its Term Deposit Facility (TDF)
Fed re-established its dollar swap lines with ECB, BoE, SNB, and BoC (announced Friday, 7-May) in response to the strains in dollar short term funding markets in fallout from the problems with Greece and the periphery
Fed began buying Treasury's outright (under QE) 25-Mar-09 and finished 31-Oct-09
Fed began buying MBS on January 5, 2009 as part of the $500 bln purchase plan announced on November 25, 2008; the size was upped by $750 bln to $1.25 tln at March 18, 2009 FOMC; completed on March 31
Fed begins buying agency debt outright (under QE) on December 5, 2008 originally planing to purchase up to $200 bln, but revised it to $175 bln through Q1 2010 amid collateral shortages
Fed funds futures remain irrelevant under ZIRP policy regime