HALISTER: Goldman’s Hatzius: Fed Balance Sheet Unlikely to Have Big Impact

Goldman’s Hatzius: Fed Balance Sheet Unlikely to Have Big Impact

(Bloomberg) -- “There’s still a big question how big of an impact it’s going to have, how much of a substitute it’s going to be for rate hikes. I think directionally it is a substitute, but I don’t think that the impact is going to be very big,” Goldman Sachs Chief Economist Jan Hatzius says about planned change in Fed balance sheet policy.
  • On Fed: “My expectation would be they hike in June, they hike in September, then they don’t hike in December but start the balance sheet rundown, and then basically see what happens,” he says in interview on Bloomberg TV
    • “If we don’t get a very large impact because it’s a very, very slow and well-signaled kind of path, then they get back to rate hikes in early 2018 -- we think March”
  • NOTE: From earlier Tuesday: Fed Economists Map Link Between Balance Sheet and Treasury Yield

Alert: HALISTER
Source: BFW (Bloomberg First Word)

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GS US (Goldman Sachs Group Inc/The)

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Jan Hatzius (Goldman Sachs Group Inc/The)

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