Softer US payrolls won't lift the urgency for QE3, which would be wasted while stocks are strong and housing on the rise.

In a week where the FOMC meet (Friday morning 0230 AEST), the softer US payrolls on Friday has intensified discussion about whether we get QE3 at the upcoming meeting. My view hasn’t changed after the result, and in fact I don’t think the number was all that relevant for the Fed. That’s because they told us that no matter what, more stimulus was coming. Substantial and sustained. They were the words they used to signal to the market that QE was a done deal regardless. So for instance, even if jobs growth was strong, they’d simply say it wasn’t going to be sustained and still make the case to print.


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