Federal Reserve announced QE2

The Federal Reserve launched a last-ditch effort to shore up the US economic recovery with a new $600 billion round of Quantitative Easing. The Fed’s first $1.75 trillion bond-buying program ran from December 2008 to March 2010.

As widely expected, Republicans regained majority in the House of Representatives while Democrats kept control of the Senate. No party has power to pass legislation without the other one, which will lead to compromises or gridlock.

Source: Exane

My View: The markets have been quite muted so far. The S&P 500 closed 1197.96 last night and the future has some what crossed 1,200, which is widely recognized resistance. Investors are much neutral about the markets but there should be some upside in the short term.

US Dollar index has been again down the drain, with EUR/USD currency pair up another 100 pips last night. I’ve mentioned in my yesterday’s blog about the currency risk involved in Singapore investors’ portfolio. If the dollar weakness continues, investors should pay more attention to their currency exposure.

About the Author

Ivan Guan is the author of the popular book "FIRE Your Retirement". He is an independent financial adviser with more than a decade of knowledge and experience in providing financial advisory services to both individuals and businesses. He specializes in investment planning and portfolio management for early retirement. His blog provides practical financial tips, strategies and resources to help people achieve financial freedom. Follow his Telegram Channel to join the FIRE community.
The views and opinions expressed in this article are those of the author. This does not reflect the official position of any agency, organization, employer or company. Refer to full disclaimers here.

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