Agency: Fed Walsh is at risk of evaporation of market confidence

In a report, BlueBay Chief Investment Officer Mark Dawdin noted that if Federal Reserve Chairman Walsh gave up on forward-looking guidance, the risk of a loss of market confidence in the Federal Reserve might increase. “The Agency enjoys a high degree of trust and credibility during the period when forward-looking guidance has been pursued by successive Federal Reserve Presidents.” Yet, in an information vacuum, market misgivings may increase and trust in the Federal Reserve may begin to shake. He pointed out that the current level of United States debt was at an all-time high and growing at an alarming rate, and that if the market were to be left unattended, there would be an enormous risk of a sudden loss of market confidence. Kim Xian