Fed May End Taper This Year Amid Regime Rethink, Pozsar Says
- Surge in T-bill supply has pushed overnight rates higher
- Introduction of new repo facility is possible: Credit Suisse
Runners pass the Marriner S. Eccles Federal Reserve building in Washington, D.C.
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America’s growing debt pile may force the Federal Reserve to stop shrinking its balance sheet before the year is out, according to Credit Suisse Group AG analyst Zoltan Pozsar.
With bank reserves at the Fed being pared, the U.S. central bank will soon have to make a choice between activating an overnight facility for repurchase agreements or halting its balance-sheet reduction earlier than many market participants expect, the former U.S. Treasury adviser wrote in a note Monday.