MIKE DOLAN: Deflating ‘QT cushion’ may have raised red Fed flag
Next year may be a bumpier ride for the US as air escapes from the quantitative tightening cushion
07 December 2023 - 05:00
London — Any real crunch for the US economy from the Federal Reserve’s balance sheet rundown may have been softened to date, but the air is rapidly escaping from one of its key cushions.
Whether last week’s rhetorical shift by the Fed acknowledges this potential crunch is an open question, but credit and liquidity watchers are calling time on how long 2023’s commercial bank reserves at the Fed can remain so stable...
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