As the Fed gets set to stop QE, Wall Street is already speculating the central bank could crank up a new bond-buying program to take its place if the economy sours.
While the odds aren’t high, Fed watchers, surveyed by CNBC, saw a 1-in-7 chance the central bank would launch another QE program within the next 12 months, but they saw a 1-in-6 chance of a new round of bond buying within two years. They also saw a 15.1 percent chance of a recession in the next year.
“I think at this point, people and economists, have become conditioned, and not incorrectly, that when things turn south that QE is just a part of the toolkit, rather than some sort of unusual policy,” said Daniel Greenhaus, chief global strategist at BTIG. “With interest rates this low, that’s probably not an unfair assumption.”
CNBC
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