Does the Fed Funds Rate follow T-Bill Rates?
I've read from a few sources that the fed funds rate simply follows the front of the 90-day t-bill rate. I've also read comments like "the feed MUST lower the FFR to keep it surrounded by line next to the t-bill rate!"Is this true, and if so, why, exactly, is it necessary for the FFR to stay contained by line next to the t-bill rate? What would be the harm surrounded by not doing so?
Thanks.
Answers: While the fed does set the nonspecific environment for interest rates in the T-bill, memo and Bond arena, market expectations do own an affect on T-bill, note, and bond pricing. When market experience extreme levels of terror people buy short permanent status Treasuries, in turn dropping the surrender on treasuries. Anticipated fed cuts enjoy the same effect, if you consider the fed will cut rates subsequent week to you buy now or dawdle until after the event? You would buy now, or if you did not you would put on the market now. The bond bazaar is very updated and there are main players in the marketplace with huge amounts of $. One could argue that these most important player affect t-bill rates as these huge players are the smart money and have information or adviser that know what they are doing and have insight into what the feed will do. They are not always right but do hold a very pious track record, the feed funds futures are also have a right track record or predicting the feds moves. The most important players in tbills and FF futures are rewarded huge amounts of $ to be right, before the feed moves so their large clients brand good money. All market predict where they deduce thing stir, the more efficient the open market the better the prediction.
Other way around. The T-Bill rate follows the Fed Funds rate.
An investment valuation of epfo,india. Has anyone worked it out so far?
i want to work on this issue if none other has undertake this for a study for a D.litt, degree.Answers: step ahead and do the analysis and we'll be glab to critique it for you.
When does the stock marketplace unambiguous and close?
just want to knoAnswers: 9:30am east coast time until 4:30pm east coast time
Here's the knit of a resolved question on the subject.
http://answers.yahoo.com/question/index?...
9:30 AM ET to 4:00 PM ET Monday-Friday (exclude Holidays)