On wednesday the 19th, we saw what was the first indications of a date to which the QE program was expected to come to an end, this of course had a huge market reaction.
Bond prices have dropped around 3% since the indication of tapering from the QE program by the Federal reserve, they indicated that 7% unemployment may be a good start and at this level they’d consider sowing down the program
***REUTERS POLL-MEDIAN OF 55 ECONOMISTS SHOWS FED WILL FIRST TAPER ITS MONTHLY ASSET PURCHASES BY $20 BLN
***REUTERS POLL-28 OF 60 ECONOMISTS EXPECT U.S. FEDERAL RESERVE TO START TAPERING BOND PURCHASES BY SEPTEMBER
These polls conducted by Reuters show a decent indication that the ending of QE may be closer than the market anticipated.
Not only did we see a sizeable reaction in the credit markets but the commodites were hit hard with Spot Gold trading as low as $1273 (-7%), Silver under $20/oz (-10%) and Oil dropping from $99 to $93.50