Tags: survey | Fed | taper | February

CNBC Survey: Fed Will Taper in February

By    |   Tuesday, 17 December 2013 11:11 AM

The Federal Reserve will begin tapering its quantitative easing in February, according to the average of a new CNBC survey of 42 Fed experts.

The CNBC's October poll had produced an average forecast of April for the start of tapering.

In the current survey, 55 percent of respondents expect the Fed to begin curbing its bond buying this month or next. Only 16 percent held that view in October.

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Last week's bipartisan budget accord in Congress increases the chance for a tapering, John Donaldson, director of fixed income at Haverford Trust, wrote in his answer to the survey, CNBC reported.

Fed Chairman Ben Bernanke "was very pointed during his September press conference that the budget/debt ceiling mess was a concern to the FOMC [Federal Open Market Committee]. This deal removes that concern and opens the door to a taper," Donaldson said.

Still, 40 percent of survey respondents don't think a tapering will come until at least March.
"Federal Reserve officials are wary of removing the 'training wheels' too soon," said Lynn Reaser, chief economist at Point Loma Nazarene University, according to CNBC.

Some experts argue that tapering is becoming problematic in that the Fed is buying a large percentage of newly issued Treasurys and mortgage bonds in its $85 billion of monthly purchases.

"The best argument for tapering sooner than later? The Fed is running out of stuff to buy," Peter Fisher, senior director at BlackRock Investment Institute, wrote in a commentary obtained by The New York Times.

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The Federal Reserve will begin tapering its quantitative easing in February, according to the average of a new CNBC survey of 42 Fed experts.
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2013-11-17
Tuesday, 17 December 2013 11:11 AM
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