EUR/USD is gobbling up big numbers they way I eat potato chips: by the handful. A 5 cent rally has unfolded today with the rally approaching 1.4150. Stocks added 5% in the US and bond yields tumbled to their lowest level in generations. 10 year notes close at 2.30% while 30 years closed at 2.82%.
The Fed held a briefing for reporters after the meeting today and those highlights are hitting the tape now. The Fed is making a distinction between the quantitative ease as undertaken by Japan saying Japan focused on the liability side of the balance sheet while the Fed is focusing on assets.
The move does not signal any new information from the Fed on the economic outlook but that the actions was spurred by economic weakness. They still expect a slow recovery in 2009. Deflation is not a major concern at this point but falling inflation is expected. Fed funds should trade a bit above zero, the official said.