At today’s FOMC meeting, Operation Twist was introduced and implemented. Operation Twist is a US Government strategy with the intention of lowering long term interest rates by selling short term bonds and using the funds to purchase the same amount of long term bonds. It is a way for the Fed to increase its stimulus policy without any additional spending – technically. The announcement of “Twist” sent the USD soaring against almost all currencies, most notably the AUD/USD and EUR/USD. Both moved approximately 200 pips.
The JPY fell versus the USD but held its own and even rose against some of its European rivals. The Sterling hit its lowest level since January as the Greenback continued to gain on the Pound, boosted by the FOMC unveiling of Operation Twist.
Gold fell today and the US equity markets tanked towards the end of the day as traders and investors cashed out of stocks.
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Daily Recap – Operation Twist
At today’s FOMC meeting, Operation Twist was introduced and implemented. Operation Twist is a US Government strategy with the intention of lowering long term interest rates by selling short term bonds and using the funds to purchase the same amount of long term bonds. It is a way for the Fed to increase its stimulus policy without any additional spending – technically. The announcement of “Twist” sent the USD soaring against almost all currencies, most notably the AUD/USD and EUR/USD. Both moved approximately 200 pips.
The JPY fell versus the USD but held its own and even rose against some of its European rivals. The Sterling hit its lowest level since January as the Greenback continued to gain on the Pound, boosted by the FOMC unveiling of Operation Twist.
Gold fell today and the US equity markets tanked towards the end of the day as traders and investors cashed out of stocks.