Alex Roever is joined by Mike Feroli and Jay Barry to discuss the outcomes of the November FOMC meeting and Treasury’s quarterly refunding announcement and the impact on the US rates market.  The Fed delivered a tapering announcement, as expected, and is likely to complete its asset purchases by mid-2022 much quicker than the 2013-2014 timeline. Moreover, the Fed changed its description on the outlook for inflation, and the onus is on labor supply is critical to thinking about the outlook for inflation and policy rates in 2022.  Front-end yields declined this week and priced a more dovish path for Fed policy in 2022, but driven more by global dynamics than the FOMC  Finally, the Fed’s quick taper has been accompanied by large cuts to Treasury auctions sizes, with more likely to come in 2022. This should allow the T-bill share of debt to stabilize.

This podcast was recorded on November 4, 2021.

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