Critical FOMC Meeting to Determine Bond and Gold Direction
- GoldSilver Pros
The FOMC has a critical meeting this week to address what many market observers see as a growing conflict between easy money policy and economic growth. Banks such as Bank of America and Goldman Sachs feel as though GDP expectations should be higher than the Fed’s outdated predictions, and require the Fed to announce more a more bullish tone. However, the recent rise in 10 and 30 year Treasury rates is signaling market expectations of inflation on the horizon. The Fed has to be careful they don’t ease too much that they stoke an episode of runaway inflation. To do so would be to bring up rates across the Treasuries complex, putting .GOV in a precarious position of higher debt costs at a time when Congress is releasing record spending bills one after the other.
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