By Ashraf Laidi at ashraflaidi.com (Guest Post)
The FOMC has done what was expected via Operation Twist; buying the same amount of Treasuries ($400 bln) as much it will sell, thereby maintaining the size of its balance sheet at $2.87 trillion. This explains today’s jump in USD. And the fact that the Fed stayed away from cutting interest rate on overnight reserves is another positive for USD & negative for equity indices. Most market observers were correct in expecting Operation Twist rather than outright QE3. It was highly unlikely for the Fed to adopt an aggressive easing less than 1…
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