The Fed just fired its biggest bazooka so far, effectively announcing open-ended and unlimited QE. The USD remains bid, analysts at Nordea inform.
Key quotes
“The USD initially sold off on the QE-eternity launch, but even that wasn't enough to keep the USD offered for more than 20 minutes.”
“The Fed is doing its best to kill the USD, but we are not convinced that it will work (yet). Once economies open up post the Corona-crisis, the USD will get hammered, but that is still not something to discuss for the next weeks.”
“The positive effect on equities has also already waned again, while Mnuchin’s comments that the US will issue ‘a lot of 30yr bond’ mattered more for the USD curve than QE-ternity.”
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