Federal Reserve Initiates Operation Twist 2.0

The Federal Reserve has started buying more treasuries on the long end of the yield curve while decreasing purchases on the short end.

The allocation across the 7- to 30-year nominal coupon maturity range will increase by 3 percentage points, in line with shifts in the distribution of Treasury securities outstanding. The allocation to the shortest nominal coupon sectors and Treasury inflation-protected securities (TIPS) will decrease modestly.

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