Brian Chappatta, Columnist

Infinite QE Was Always Left Unsaid by the Fed. Until Now.

Vice Chair Randal Quarles hints at what bond traders have long known: The central bank can’t ever truly step back from the $20.4 trillion U.S. Treasury market.

October 19, 2020 at 10:00 AM UTC

By Brian Chappatta

Brian Chappatta is managing editor of Bloomberg News' leveraged finance and distressed debt teams. He was previously managing editor and team leader of its wealth group. Before that he was a Bloomberg Opinion markets and finance columnist and a bonds reporter for Bloomberg News.

Voices carry.
Photographer: Zach Gibson/Bloomberg

Provide news feedback or report an error

Site feedback:

Take our Survey

This article is for subscribers only.

Federal Reserve Vice Chair for Supervision Randal Quarles said the quiet part out loud.

Quarles, who typically centers his remarks on topics like the health of the U.S. banking system and the transition away from the London interbank offered rate, made surprisingly candid comments last week when discussing the ballooning size of the U.S. Treasury market and the central bank’s role in it. Effectively, he acknowledged that he’s grappling with the question of whether the Fed has no choice but to buy bonds forever.