Underpriced Repo Risks May Push Fed Toward QE4, Pozsar Says
- Year-end period ‘shaping up to be the worst in recent memory’
- Credit Suisse analyst says ‘reserves are still insufficient’
The Marriner S. Eccles Federal Reserve building in Washington, D.C.
Photographer: Andrew Harrer/BloombergThis article is for subscribers only.
Funding markets are underpricing the risk of renewed turmoil at year-end and the Federal Reserve may be forced to embark on a fresh round of quantitative easing to relax constraints.
That’s the view of Credit Suisse analyst Zoltan Pozsar, who said in a note Monday that the upcoming year-end is “shaping up to be the worst in recent memory.”