On June 19, 2013, following the FOMCĂ˘â‚¬â„˘s regular policy meeting, the Chair of the FOMC made remarks during a press conference that were widely interpreted in financial markets to mean that the Fed might begin reducing the size of its $85 billion in monthly asset purchases sooner than expected.
a) What effect, if any, should this statement have had on interest rates and dollar exchange rates?
b) In the days following the press conference, the Fed worried that markets had overreacted, and several Fed officials, including the Chairman, strongly reiterated that reductions of asset purchases would begin only if economic conditions warranted, indicating that reductions in asset purchases might not happen sooner than expected. What effect, if any, should this statement have had on interest rates and dollar exchange rates?
Save your time - order a paper!
Get your paper written from scratch within the tight deadline. Our service is a reliable solution to all your troubles. Place an order on any task and we will take care of it. You wonâ€™t have to worry about the quality and deadlinesOrder Paper Now