Pimco, Goldman, RBC Say Bernanke to Revisit Operation Twist
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The Federal Reserve will seek to narrow the difference between short- and long-term borrowing rates as early as this month as stalled employment growth threatens the recovery, according to Wall Street bond dealers and the world’s biggest manager of fixed income funds.
Pacific Investment Management Co., Goldman Sachs Group Inc. and Royal Bank of Canada said they expect the central bank to announce plans to raise the average maturity of its bond portfolio by selling shorter-term debt and reinvesting proceeds from maturing securities into longer-term bonds. The Fed purchased $2.3 trillion of debt since 2008 in two previous rounds of what’s become known as quantitative easing, or QE, to drive rates lower and help spur growth.