Funding Market Signals Fed Has Time to Weigh Tapering of Asset Runoff
- US funding markets have been stabilizing so far this year
- Fed likely set to discuss when and how to taper asset runoff
The Marriner S. Eccles Federal Reserve building in Washington, DC.
Photographer: Stefani Reynolds/BloombergThis article is for subscribers only.
US funding markets are offering signs of encouragement to the Federal Reserve as it determines exactly how and when to slow the pace at which it drains excess cash from the financial system.
Short-term funding markets have been stable, and for now, stress free. That offers considerable flexibility and a positive backdrop as Fed officials meet — and likely discuss the path ahead for quantitative tightening, or QT.