Deutsche Bank: Here Are The Two Possibilities For What The FOMC Will Announce Next Week

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Deutsche Bank have laid down the gauntlet, predicting exactly how the Fed is going to announce QE 2, after the FOMC meeting November 2-3.

Their predicted language for QE 2 calls for either:

  • An additional $125 billion in longer-term treasury purchases before the next FOMC meeting on December 14th (hawkish)
  • Or an additional $50 to $100 billion in longer-term treasuries per month, with a max of $500 billion in the next 6 months (dovish)

Deutsche Bank also make clear that the Fed will leave open the possibility for more purchases, in a more active manner in the hawkish view, or with slightly more curtailed language in the dovish view.

So those are some particular numbers to look for. Should provide some solid goal posts to determine the members of the FOMC that are having their voices heard, the more dovish or hawkish.

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