The Fed just triggered the biggest stock-buying program since Nov 2022...
Source: Bloomberg, www.zerohedge.com
Monetary policy is now easing globally - and will ease much more in 2024/25 - at a time when fiscal deficits are far above the global financial crisis levels
Source: BofA
Too much, too fast? Markets is seeing the FED being the most aggressive in terms of rate cuts next year
Source: DB, TME
Gold rallying to 2k$ despite investors selling gold is remarkable. Is it all driven by central banks demand?
Source: Michel A.Arouet, Bloomberg
Losses at the Fed have now passed $125 billion
Source: Win Smart, CFA
Central banks are on pace to buy over 1,000 tons of gold again
Despite the near-record annual purchases, it's worth noting that these institutions once held 80% of their balance sheet in gold Today, it's barely 20%. A return to the historical average of central banks holding 40% of their balance in gold could propel gold prices north of $3,000 based solely on that capital dynamic... Source: Tavi Costa, BofA
The Federal Reserve lent out roughly $200B in overnight cash on Wednesday through its standing repo facility
This is the highest amount since the onset of covid. What's going on? Is another repo crisis looming? Source: Win Smart, CFA
Odds of rate cuts beginning as soon as January 2024 are rising quickly
There is now a ~15% chance of rate cuts beginning next month. The base case shows a ~56% chance of rate cuts beginning in March 2024. Markets are currently expecting a total of FIVE 25 basis point rate cuts in 2024. Still, the Fed has yet to discuss the possibility of any rate cuts at all. Markets are fully bought in to the "Fed pivot." We believe that the economy will continue to slow down and that rate cuts will take place next year. However, a lot pof these cuts are already priced in. This could generate some volatility for bonds and stocks in case of disappoinment (aka macro data surprising on the upside). Source: The Kobeissi Letter
