The Fed pumped cash into the market holding both Fed Funds and Open Market Operations repo rates just below 2% on the eve of Wednesday’s policy announcement. In the past they have often signaled their intended action by allowing these rates to rise or fall. The fact that they acted to hold rates stable suggests that they will make no policy change, but as Treasury supply increases the Fed will be under increasing pressure to raise rates rather than feed the commodities crack-up boom. That pressure will begin immediately as the market looks forward to settling $28 billion in new Treasury supply next Monday, with more to come throughout the summer. Click here to download complete report in pdf format (Professional Edition Subscribers). Try the Professional Edition risk free for thirty days. If, within that time, you don’t find the information useful, I will give you a full refund. It’s that simple. Click here for more information.
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