Analysis: Fed's focus turns to expectations

05/28/2013 | Wall Street Journal, The

Volatility is a potential consequence of market expectations failing to anticipate the Federal Reserve's planned actions, according to this analysis. Minutes from the last Fed meeting show that some members were concerned about investors' expectations about the central bank's asset-purchase program. Without short-term interest rate expectations to help gauge the market, the Fed must rely on alternate tools like the New York Fed's dealer survey to help judge what market participants are thinking.

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Wall Street Journal, The

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