Source: Taiwan Economic Daily
Economic Daily News
The Federal Reserve (FED) Federal Public Marketing Committee (FOMC) held a decision-making meeting on the 29th to determine that interest rates remained at 0-0.25%.Loose loose measures have no unexpected move.However, from the statement of the meeting and the conversation of Chairman Ball at the press conference, it is not difficult to find that the attitude is still cautious in terms of economic outlook, the effects of loose policies, and the expansion of the government and Congress in the fiscal policy.Unlike President Trump, full of beef.
First of all, the focus of this meeting is not that the Fed is not to launch those new loose measures, or expand the scale of existing measures, but is optimistic about whether the prosperity of the second half of the year.In the first quarter of the United States, the economy has shrunk, and the second quarter is bound to be more serious. The negative growth for two consecutive seasons has become a final game. It is in line with the definition of recession. It is not surprised by all walks of life.Ball had previously revealed that he predicted that the economy would rebound in the second half of the year, but the latest views on Fed now obviously disappointed all circles.
The biggest point declared after the meeting is that the Fed believes that the new crown pneumonia's epidemic will suppress economic activities, employment and inflation in the short term, and cause significant risks to the mid -term economic outlook.According to the long -term observation of the FED, short -term is usually three months, so it refers to the next three months, which is the second quarter.As for the middle period, it is usually covered in the next six months, so it is not optimistic whether the prosperity in the third quarter can recover.Ball also emphasized that the depth and length of the economic decline are extremely uncertain, and it is mainly controlled by the pneumonia epidemic. Obviously, the possibility of V -type rebound in the fading of the prosperity.No wonder the Fed promises to take all appropriate tools and actions to support the US economy, and the continuous time of various loose measures will last longer.
Secondly, FED is still highly worried about the effect of loose policy transmission.At present, in addition to reducing interest rates to zero, and buying public debt and mortgage guarantee securities, it also supports the commercial bill market and corporate bonds, purchases high -risk junk bond ETFs, and promises to directly purchase short -term debt in various states and some cities.The total loose scale is absolutely powerful, and the Ren Du Er pulse of the capital flow is extremely powerful.Although the large water pipes sent from the FED to the banking system and the bond market are unimpeded, but the funds have further flowed to the small water pipes of the family and the enterprise, but they can not flow to the place where the most money is needed.
Fund is a vector with quantity and direction.Of course, the FED understands that the function of the transmission mechanism is not as good as ideal, so it will emphasize that you will buy a variety of assets (Purchase Amounts Needed), so that the loose policy can achieve effective transmission.Push the funds to all directions and reach the ultimate destination; that is, monetary policy operations also shift from indirect to direct, from control of macro -control (Control) to COMMAND.
Furthermore, Ball is also worried about Fed Dugu.After all, the central bank can only borrow money and cannot pay money. Only the government can pay for money, and it must pass the budget through Congress.At present, if some members have been concerned that the government has expanded public expenditures significantly, it will inevitably affect the improvement of finance or interfere with the expansion expenditure plan based on political considerations.
In this regard, Ball is both hard and hard.On the one hand, warning that economic activities in the second quarter may decline at unprecedented speeds, and even after the epidemic has a fever, the recovery is quite weak.On the other hand, he also resorted to feelings, indicating that many workers were unemployed to make him heartbreak, emphasizing that it was not time to worry about budget deficit.In this way, we should put pressure on the government and Congress, hoping to further expand fiscal expenditure.
According to the above observation, the following judgments can be made on the policy position of FED.First of all, FED is not very optimistic about the prosperity of the second half of the year; second, the zero interest rate in the United States may be maintained at least until the end of 2021; third, the amount of debt purchase will increase or decrease depending on the actual financial situation;Then introduce new measures or expand the scale of existing measures; fifth, the possibility of implementing negative interest rates is not much.
This also shows that the current loose measures of FED are still the main goal of saving the economy. After the epidemic has a burden, the economy is still not much.After all, how to develop pneumonia is the biggest uncertain factors facing the current economy. Any predictions and planning belong to the talked of soldiers on paper, and everything must still follow the epidemic.
