Sentences with phrase «end of the tightening cycle»

The question lingering on investors» minds is how many rate increases the central bank intends to implement until the end of the tightening cycle, and if it was willing to raise rates above it its so - called neutral rate.

«By the time 10 - year and 2 - year Treasuries reach parity, as is almost the case now, the economy is typically slowing and the Fed is at or near the end of its tightening cycle.»

You can see the panics around LTCM (1998), the end of the tightening cycle in 2000, and the money market troubles in 2007.

My main point is this: even with the great powers that a central bank has, the next tightening cycle has ample reason for large negative surprises, leading to a premature end of the tightening cycle, and more muddling thereafter, or possibly, some scenario that the Treasury and Fed can't control.

At the end of the tightening cycle, something blows up that would be a surprise now, which sometimes jolts the FOMC to stop tightening.

We know how this one ended, but at the end of the tightening cycle, it seemed like another success.

Not exact matches

But he also points out that 10 of the 13 postwar Fed tightening cycles have ended in unexpected recessions.

If the Fed tightens enough to induce a recession, that's the end of the business cycle.»

«Remember, Fed tightening cycles start off benign but 10 of the 13 in the post-WWII era have ended in tears.»

These arguments include the Fed Model, the advocacy of price / operating earnings ratios, supposed links between earnings growth and market returns, arguments that the end of a Fed tightening cycle is quickly favorable for stocks, etc..

Now, as I noted fairly early this year, there's no statistical evidence at all that stock prices or corporate earnings perform well in the 18 months or so following the end of a rate - tightening cycle.

However, the Fed's emphasis on downside risks is injecting a degree of uncertainty — and volatility — into markets, a factor not lost on global policymakers that are calling on the Fed to end its handwringing and begin the tightening cycle.

They can engage in fancy strategies where they try to remove policy accommodation either through rates or the size of the balance sheet, but one thing Fed history teaches us is that the Fed doesn't know what will happen when a tightening cycle starts, but usually it ends with a bang — some market blowing up.

Consider the yield curve just before the beginning of the 2004 tightening cycle versus the curve shape at the end of that cycle (see Exhibit 2).

But tightening the Fed funds rate is not easy, particularly toward the end of the cycle.