Published: Thu, June 15, 2017
Markets | By Noel Gibbs

Fed Rate Hike Does Not Ding Senior Housing REITs

Fed Rate Hike Does Not Ding Senior Housing REITs

The Federal Reserve's balance sheet will shrink by $1.1 trillion to $3.3 trillion by 2020, estimated Goldman Sachs in a new note on Wednesday evening. June's rate increase reflects this continued belief, and follows Janet Yellen's, FOMC Board of Governors Chair, comments from March that, "we continue to expect that the ongoing strength of the economy will warrant gradual increases in the federal funds rate to achieve and maintain our objectives". Yellen detailed a plan to slowly pare the amount of proceeds from maturing securities that are reinvested.

For agency debt and mortgage-backed securities, the cap will be $4 billion per month initially, rising by $4 billion at quarterly intervals over a year until it reached $20 billion per month.

They see Fed policymakers raising the bank's key overnight borrowing rate one more time by the end of 2017 and three times in 2018 despite growing concerns that inflation would fall short of their 2.0 percent goal in the foreseeable future, according to the poll.

Daddy's Home 2 trailer features Mel Gibson as Mark Wahlberg's dad
Now he's here to show off his comedy chops in Daddy's Home 2 , playing the hyper-masculine father to Mark Wahlberg . Maybe the comedy can steer away from the more broad humor and lock down something a little more clever this time.


How the Fed shares information about its plans is extremely important to financial markets, even more so "than the actual event of letting the balance sheet decline", Ryan Sweet, director of real-time economics at Moody's, said in an interview with TheStreet before the announcement.

Fourteen of the 21 primary dealers surveyed said the Fed would announce the start of its balance sheet normalization at its September 19-20 policy meeting. The move was widely anticipated within senior housing and other industries, and continues a trend toward higher rates that the Fed began in December 2015, following an extended period of ultra-low rates following the economic crisis in 2008.

The Fed's conviction that it was ready to back away from its unconventional monetary policy caught some traders off guard as bond yields recovered slightly after falling sharply earlier in the day on a weaker-than-forecast report on Consumer Price Index in May.

US retail sales post biggest drop in 16 months
It will also be welcome news to Bank of England , which tries to keep inflation close to 2 percent. The rate recorded for May is the lowest inflation recorded since December 2013.


Yellen indicated the Fed still remained confident inflation would rise to its target over the medium term, bolstered by what she described as a robust labor market that is continuing to strengthen.

The Fed now sees the unemployment rate ending the year at 4.3 percent, where it sits currently, rather than the 4.5 percent previously expected. The core rate of inflation increased at just 1.7 per cent on year, the fourth straight monthly deceleration and the slowest overall pace in two years.

Minneapolis Fed President Neel Kashkari dissented in Wednesday's decision.

Eoin Morgan admits to England regrets after dismal Champions Trophy exit
We did prepare, Pakistan bowled well but we didn't adjust and 200 isn't competitive, 250-270 would be a good score. Sarfraz added: "After that first loss, we were very down". "We played the last ODI here".


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