Due to a quirk in the Federal Reserve calendar, the central bank doesn’t meet in May. (Next meeting June 10; last meeting April 29.) That means the Fed has lots of time to jawbone the financial markets and Congress in an effort to get Washington to provide more fiscal stimulus to the economy.
It all starts today when Raphael Bostic, head of the Atlanta Fed, discusses the response to the pandemic.
And then, on Tuesday, the palaver goes into high gear with St Louis Fed president James Bullard on the economic outlook; the Minneapolis Fed’s Neel Kashkari on the economy; the Philadelphia Fed’s Patrick Harker on the impact of the coronavirus;  and vice chair Randal Quarles before the Senate Banking Committee.
On Wednesday Fed chair Jerome Powell gives a remote speech at the Peterson Institute for International Economics. Given the audience, you can bet the Powell will continue his recent theme of pointing out that the Fed can’t send stimulus directly to consumers and urging Congress to act.
The week ends with Kashkari speaking again and Robert Kaplan, president of the Dalls Fed, weighing in.
Meanwhile, in the backdrop, the Treasury just keeps those debt auctions running:
May 11: $42 billion of 3-year notes.
May 12: $35 billion of 119-day cash management bills; $65 billion of 42-day cash management bills and $32 billion of 10-year notes.
May 13: $22 billion of 30-year bonds.
So far, no signs that the bond market is choking on the auction volumes. Today the yield on the 10-year Treasury was up only slightly to 0.72% (higher yields occur when bond prices fall.) The yield on the 2-year Treasury held at 0.17%.
