TOKYO: Interest rates are so 2018. None of that pleased stock investors, with the S&P 500 Index sliding Wednesday, mostly after Chairman Jerome Powell said the Fed’s quantitative tightening will continue apace.Fed policy makers have long considered the reversal of quantitative easing as a mechanical process, not an active policy instrument. Governor Lael Brainard in 2017 said the case for subordinating the balance sheet to interest-rate policy was “straightforward and compelling,” while stopping short of ruling out its use as a tool.Then-Chair Janet Yellen said 18 months ago that the unwind would be like “watching paint dry.”But when Powell on Wednesday said at a press conference that the process is indeed progressing smoothly, on “autopilot,” investor disappointment was clear. The S&P 500 slumped 1.5 percent by the close, some 14 percent down from the record hit in September. - Bloomberg

Source: The Star December 20, 2018 08:37 UTC