Here's What Wall Street Is Saying About The Fed's Decision To Taper Again

The Federal Open Market Committee just announced an additional $10 billion tapering of the monthly bond purchases it makes under its quantitative easing program.

The reactions are pouring in from Wall Street strategists and economists.

Here's what they're saying:

JAN HATZIUS, CHIEF ECONOMIST AT GOLDMAN SACHS: Hatzius says the part of the statement where the FOMC says, "Labor market indicators were mixed but on balance showed further improvement," is indicative of a "slight downgrade" to the Committee's assessment of the labor market, given the use of the word "mixed." On the other hand, the assessment of the overall economic picture was positive. (via Bloomberg)

MILLAN MULRAINE, DEPUTY HEAD OF U.S. RESEARCH AND STRATEGY AT TD SECURITIES: "The apparent absence of any concern about the recent turmoil in EMs and possible feedback to the US economy was reflected in the unchanged growth and labor market assessment. In particular, the Fed continues to see the risks as 'more nearly balanced', which is a reaffirmation of the view expressed at the December meeting when tapering was launched. In fact, they reinforced their optimistic outlook for growth, noting that they expect 'economic activity will pick up at a moderate pace.' In a glaring departure from the last few years, the policy decision was unanimous among voters - with even Kocherlakota, who argued against tapering last month voting in favor of a further cut. The bottom line here is simply that the Fed continues to have full confidence in the US economic recovery, and their decision to stick to their tapering agenda suggests that they are looking through the recent weak tone in the data. Given this, we continue to expect the Fed to maintain this tapering pace, with a further $10B cut at each meeting in the coming months, ending the program by Q4 this year."

IAN SHEPHERDSON, CHIEF ECONOMIST AT PANTHEON MACROECONOMICS: "The statement is a bit more upbeat than in December, suggesting the Fed is (even) more comfortable with its decision to taper. Growth is now said to have 'picked up in recent quarters', compared to 'expanding at a moderate pace' in December, while consumption and investment 'advanced more quickly in recent months', compared to merely 'advanced' in December. And fiscal restraint 'is diminishing', compared to 'may be diminishing'. No specific comment on the December payroll data; labor market indicators are said to be 'mixed but on balance showed further improvement'. We expect a further $10B taper in March, barring an EM meltdown."

More to come as we get it...

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