The Yield Curve Is Moving With Risk and Virus Outlook, Says BofA's Cabana

The video discusses the Federal Reserve's dovish stance, emphasizing no imminent rate hikes and the influence of the virus on the back end of the yield curve. It explores the potential for yield curve control, focusing on the Fed's response to rate increases driven by healthy or unhealthy factors. The discussion includes the impact on steepeners, with expectations of suppressed intermediate yields and higher inflation expectations at the back end. The Fed's forward guidance is linked to inflation, with challenges anticipated in meeting inflation mandates.

In what ways might the back end of the curve be influenced by risk sentiment?

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What factors does the Fed consider when evaluating the increase in rates?

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What is the significance of yield curve control in the context of the Fed's monetary policy?

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How does the Fed's forward guidance relate to inflation expectations?

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What challenges does the Fed face in achieving its inflation mandate in the next economic cycle?

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