Fed is shrinking its balance sheet again, yet the dollar falls
Fed has now let its balance sheet drop more than $450 billion since May, yet the US dollar (DXY) has been falling ever since.
During the market crash in February and March, the Fed expanded its balance sheet by a record $1.65 trillion - the dollar was still bid up massively.
Long term yields have stayed at record lows, and even get bid up. Sure the Fed has been buying, but Treasury auctions is still sold at record high prices (low yields).
The market is telling you there is no inflation in sight, and when Fed is telling you QE is money printing, the market is telling you it's not.
During the market crash in February and March, the Fed expanded its balance sheet by a record $1.65 trillion - the dollar was still bid up massively.
Long term yields have stayed at record lows, and even get bid up. Sure the Fed has been buying, but Treasury auctions is still sold at record high prices (low yields).
The market is telling you there is no inflation in sight, and when Fed is telling you QE is money printing, the market is telling you it's not.