Any analysis on the Powell talk yesterday?

[muscleman]

Everyone knows the rate hike will be 0.5 instead of 0.75%, which is nothing interesting. I was looking for whether he is adjusting the amount of QT, and it wasn't clear to me. I know previously he said the fed would do 90 bn per month QT.

Does the following bullets say that the FED intends to do 30+17.5 bn QT per month?

 

https://www.federalreserve.gov/newsevents/pressreleases/monetary20220504a1.htm

• Roll over at auction the amount of principal payments from the Federal Reserve's holdings of Treasury securities maturing in the calendar month of June that exceeds a monthly cap of $30 billion. Redeem Treasury coupon securities up to this monthly cap and Treasury bills to the extent that coupon principal payments are less than the monthly cap.
• Reinvest into agency mortgage-backed securities (MBS) the amount of principal payments from the Federal Reserve's holdings of agency debt and agency MBS received in the calendar month of June that exceeds a monthly cap of $17.5 billion.

[Spekulatius]

@muscleman, yes the total quantitative tightening seems to be $47.5B monthly, which is basically a nothingburger.

[Gregmal]

Yea 47.5b and 50 bps on the Fed funds rate, or….bubble that started busting over a year ago continues to burst and similar to almost every bubble in history, the slow melt phase accelerates into a widespread panic phase…. you tell me what’s driving the market? Folks often need reasons for things so there is a need to draw them up. Best example is on CNBC or Seeking Alpha where the headline is “abc is down today, here’s why” and then you look and it’s flat or up. Fed doesn’t set the stock market returns as part of its policy. It’s just kind of acts as a buffer to keep things generally going the way they need to be. The easy money just sloshes around. Right now it’s in energy.