In addition, the FOMC will be reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in mortgage-backed securities rather than Treasuries. This action was intended to help support mortgage markets. I dissented from both of these decisions.
First, the possibility of a rise in global risk premia has increased in an environment of political uncertainty and benign pricing in the markets. Second, possible rising negative feedback loops between weak bank profitability, in the face of structural challenges in a low interest rate environment, and low nominal growth.