The Fed finally showed some guts and started the taper on the QE bond buying program. It will reduce its bond purchases by $10 billion to $75 billion starting in January.
The Fed said the taper was not on a pre-set course, meaning that it does not necessarily intend to taper every month and at every meeting. The continuation of the taper will depend on the economic data.
The bond market was calm in the face of the announcement but 10-year yields had already risen in anticipation of the possibility of a taper. It was already priced in.
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