The shares outstanding in iShares TIPS Bond ETF, a fund with more than 53 percent of its assets in long-term inflation- linked products, exceeded those of the FlexShares iBoxx Three- Year Target Duration TIPS Index ETF by 23,946 on Sept. 10, the lowest on record
Essentially, the Fed has been pushing stock and bond prices up to "bubblish" levels, in the expectation that they will inspire the kind of consumer spending, physical investments and hiring required to subsequently justify them. The hope is that the convergence will occur in the context of full employment.
The yen rose the most in almost a month versus the euro on speculation the Bank of Japan stimulus is boosting the economy while the European Central Bank will expand currency-debasing measures to revive growth.
Central bankers are seeking to provide clarity on their plans for continuing to support the economy, both with low interest rates and dwindling bond purchases, after unemployment dropped last month to 6.6%, the lowest in more than five years.
Provided the economy performs as well as Federal Reserve policymakers expect, the Fed will phase out large-scale asset purchases within the next 10 months. That’s a big “if” of course. The Fed has been projecting a stronger recovery each of the last four years, only to see growth average around a tepid 2%.