The Fed's open-ended extension of QE comes a surprise to some investors, Societe Generale says, after it announced Thursday that it would buy $40 billion of mortgage-backed securities every month until the job market improves, extend low interest rates until at least mid-2015, go on buying bonds as the economy requires and continue "Operation Twist." SocGen currency strategist Kit Juckes notes thinking that investors already knew that Ben Bernanke was the "most dovish central banker ever to have walked the earth" was misguided and clearly there were investors out there who viewed the open-ended extension of QE as a surprise. Mr. Juckes says, "There is no point standing in the way of a tidal wave of position adjustment," adding the bank doesn't plan to sell EUR at these levels just yet, but recommends buying CAD/JPY and USD/JPY. EUR/USD is at 1.3049.
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