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Bernanke Defends QE2
11/19/2010
Fed Chairman Bernanke spoke to the European Central Bankers this morning defending QE2; the Fed is scheduled to purchase between $1.5B and $2.5B in Treasuries with maturities ranging from August, 2028 to November, 2040. For the fifth time this year, China has told banks to set aside larger reserves in an effort to limit inflation. Right now, the futures market is pricing in a 92% chance that the Fed keeps rates between 0% and 0.25% through March 15th, 2011. Currently, the Ten Year yield is at 2.88% (2.90% yesterday) and the 2-10 yield spread is at 238bps, flattening 2bps since yesterday morning.
