Prices drop after Fed minutes show support for taper
Published on Feb 20, 2014 4:41 AM
NEW YORK (REUTERS) - US Treasury prices fell on Wednesday as minutes of the Federal Reserve's January meeting showed members supported continued tapering of the central bank's bond-buying program in the absence of a significant change in the economy.
The minutes showed members on the Fed's policy setting committee wanted to affirm that its asset-purchase program would be trimmed in predictable US$10-billion (S$12.6 billion) steps.
The Fed is seen likely to continue paring its monthly purchases as Fed members view much of the recent economic weakness as a temporary phenomenon that is due to unseasonably cold weather.
"It suggests that they see the recent weakness in economic activity as fairly transitory. They don't think this is a permanent trend. Even if we see lower growth in 2014 they will still continue to taper," said Gennadiy Goldberg, an interest rate strategist at TD Securities.
To continue reading, log in if you are a subscriber
If you are not a subscriber, you can get instant, unlimited access here