Four Things to Watch at Fed Meeting

  1. QE strategy: he notes that the ‘activist wing’ of the Fed wants a large, open-ended commitment to bond buying.
  2. What to do with Twist: the Fed must decide to do about Operation Twist. The program could be suspended and replaced, or a new MBS program could be launched at the same time
  3. Communication: cites this paper and says ‘Fed seems to be moving’ in the direction of committing to easy policy until the Fed meets economic targets
  4. Whether to lower another rate: the Fed could lower interest on reserves but ‘it’s unclear whether the Fed will do anything on this front.’

Overall, no strong hints about what the Fed will do. I don’t believe Hilsenrath has any inside info but others do.