03:39:25 EDT Mon 20 Sep 2021
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Bank of Montreal
Symbol BMO
Shares Issued 647,059,842
Close 2021-03-24 C$ 110.56
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FP says BMO, rivals hear BOC allay taper tantrum fears

2021-03-24 07:23 ET - In the News

Also In the News (C-BNS) Bank of Nova Scotia
Also In the News (C-CM) Canadian Imperial Bank of Commerce (CIBC)
Also In the News (C-NA) National Bank of Canada
Also In the News (C-RY) Royal Bank of Canada
Also In the News (C-TD) Toronto-Dominion Bank

The Financial Post reports in its Wednesday edition that the Bank of Canada is working hard to avoid a taper tantrum when it eventually decides to slow its government bond purchases. The Post's Kevin Carmichael writes that Toni Gravelle, a deputy governor, used a speech on Tuesday to further condition traders for the eventual end of quantitative easing (QE). Mr. Gravelle emphasized that the shift -- when it comes -- will be gradual, soothing traders who might panic if the BOC were to remove itself as a major buyer of government debt too abruptly. Some analysts, including Bank of Montreal economist Benjamin Reitzes, think the BOC could start the process of scaling back its bond purchases as soon as April, because the recovery appears to be stronger than expected. Mr. Gravelle said: "I want to be clear here: moderating the pace of purchases while adding to our holdings would simply mean that we are still adding stimulus through QE, but at a slower pace. It would not mean we are removing stimulus. We would be easing our foot off the accelerator, not hitting the brakes." The BOC is currently sitting on a portfolio of financial assets worth about $575-billion, compared with $120-billion before the pandemic.

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