By Karen Brettell
Apr 9 (Reuters) – The Federal Reserve’s plan to recalibrate bond purchases to better match America’s outstanding debt is likely to provide only marginal support to longer-lasting bonds, hit by shocks. expectations of faster growth and higher inflation, and analysts warn that the move should not be called a “turnaround.”
The New York Fed said Thursday it could make small adjustments to keep bond purchases commensurate with the outstanding supply.
Comments from Lorie Logan, executive vice president of the New York Fed and manager of the System’s Open Market Account (SOMA), briefly pushed long-term yields down, although they rose again on Friday pending the new offer. long-term next week.
“On the sidelines, this should push back the (curve) re-start narrative,” said Ian Lyngen, head of US rates strategy at BMO Capital Markets.
However, the move is part of the Federal Reserve’s current policy of adjusting purchases to pending issues and is not a new way “of trying to influence the shape of the curve or yield levels,” he added.
Market players have been looking to see if the Fed will intervene to stem the rise in long-term yields, which are rising as the economy recovers activity, while deficits widen to record highs and the Treasury sells a new one. unprecedented offer to finance economic stimulus.
(Reporting by Karen Brettell; Edited in Spanish by Javier López de Lérida)