The Fed remains cautious on QT | 30 10月 2023

30 10月 2023, GBP/USD

The Fed remains cautious on QT

GBPUSD trading plan:

The Fed continued to undershoot QT. The volume of mortgage-backed securities fell by $16.7 billion; the volume of Treasury securities fell by $1.7 billion (bills only), and over the past four weeks the Treasury portfolio has fallen by $46 billion (compared with a planned $60 billion). This could indicate that the Fed is making local interventions in the Treasury market from time to time. The US Treasury market continued its upward trend under conditions of low liquidity, but yield changes in the week ending 25th October were insignificant, while volatility was high. Auctions were very uneven: five-year securities were poorly placed, while seven-year securities were quite normal. It is important to note, however, that all auctions will be executed on 31 October, with a total volume of $440 billion, of which $154 billion are bonds with maturities of 2 to 20 years, which have led to "volatility spikes" in recent weeks.

Investment idea: sell 1.2130 and take profit 1.2051.

David Johnson
Analyst of «FreshForex» company
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