Market Nuggets: BBH: FOMC 'As Aggressively Dovish As Anyone Expected'

Wednesday December 12, 2012 1:08 PM

The U.S. Federal Open Market Committee was "as aggressively dovish as anyone expected" with a post-meeting policy statement, says Brown Brothers Harriman. Policy-setters announced another $45 billion per month in outright Treasury purchases on top of the $40 billion monthly buying of mortgage-backed securities, all meant to push down long-term interest rates. "It also changed from time reference for guidance to use of inflation and even there it is dovish, indicating rates will remains low as long as inflation is below 2.5% and unemployment is above 6.5%," BBH says. The U.S. dollar declined across the board after the Fed statement, BBH says. As of 1:03 p.m. EST, the euro was up to $1.3093 from $1.3004 late Tuesday. Metals traders tend to monitor foreign-exchange moves since prices often move inversely to the U.S. dollar.

By Allen Sykora of Kitco News