The Fed's early discussions of its longer-term balance sheet sound hawkish but are unlikely to meaningfully impact market prices. QT is expected to end in the coming months, with some possibility of an abrupt end due to to debt ceiling concerns. After QT, the Fed will still have to manage a sizable holding of $6t in Treasuries and MBS. Fed officials are thinking of gradually shifting their portfolio to be exclusively in Treasuries, and to […]