This post was originally published on this site Bond traders are betting that no matter who’s leading the Federal Reserve come February, policy makers won’t stray from the path they’ve been laying out for months.
With Janet Yellen coming off what may have been her final address as Fed chair at the central bank’s annual Jackson Hole gathering, investors are starting to look ahead to who might follow her.
The clear front-runner, judging by a survey of economists: White House adviser Gary Cohn, whose fate roiled markets this month when rumors swirled that he’d resign over President Donald Trump’s response to a violent white-supremacist rally.
Whether Trump nominates the former Goldman Sachs Group Inc. president or reappoints Yellen, investors overseeing more than $1 trillion in fixed-income assets see little change in the Fed’s course: a drawn-out process of trimming its balance sheet and raising interest rates.
Yet now such an approach might work to his disadvantage, given his administration’s goals of cutting taxes, increasing infrastructure spending and spurring exports: Higher borrowing costs, which could boost the dollar, would impede those efforts.
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- Sorry, Janet Yellen: Government Doesn't Solve Financial Crises, It Creates ThemThe Federalist
- Gold Daily Analysis – August 29, 2017FX Empire
- There's too much at stake for Gary Cohn to quit on TrumpNew York Post
- Central bankers said nothing at Jackson Hole – but markets knew what they meantMoneyWeek
- Wall Street steady as dollar index drifts to fresh lowsFinancial Times
- Yellen's chances for an encore just got toughergulfnews.com
- Ain't No Sunshine For The Dollar YetSeeking Alpha
- Yellen's frank Fed talkPittsburgh Post-Gazette