Veteran Fed watcher and Bloomberg columnist John Berry has given pause to those expecting Greenspan and Co. to refrain from making an eleventh straight 25 basis point hike in the Fed funds rate. Just as forex and bond traders were pricing in no changes for the month of September and perhaps the rest of the year, Berry's column hit the wires. The market response was immediate. According to Reuters:
Dollar buying perked up late in the Tokyo session on comments by Fed watcher John Berry. His column, in Bloomberg News, said the odds were slightly in favour of the Federal Reserve raising rates by 25 basis points when it meets on Sept. 20.The Euro subsequently dropped a full cent, while the 10-year US Treasury's yield rebounded to 4.06%. We know that Bloomberg covers markets well, but this is an instance when Bloomberg actually moved markets. Whether Berry is right, though, I'm not certain of yet.
Posted by Emmanuel |