Poll: Fed’s taper is a non-event

Washington — An anticipated reduction in stimulus by the Federal Reserve that has roiled the financial markets for months will be seen as no big deal if it goes ahead next week, according to a Bloomberg Global Poll of investors.

Fifty- seven percent of those surveyed say they don’t expect a sudden change in the markets because investors already anticipate tapering action by the U.S. central bank.

Eight percent see a rally on such news, while just under a third are looking for declines, based on the Sept. 10 poll of 900 investors, traders and analysts who are Bloomberg subscribers.

“A taper-lite seems priced in” by the markets, Greg Lesko, managing director at New York-based Deltec Asset Management, said in an email, referring to what he says will be a small reduction in stimulus by the Fed. Lesko took part in the quarterly survey.

The yield on the 10-year Treasury note rose to 2.91 percent at 5 p.m. in New York Thursday from 2.04 percent on May 22, when Fed Chairman Ben S. Bernanke raised the possibility the central bank might cut back its stimulus this year. The MSCI Emerging Markets stock index has fallen 5.5 percent over that time.

A plurality of those polled - 38 percent - expects the central bank to decide at its Sept. 17-18 meeting to start lowering its monthly bond purchases. Another 35 percent see such a step in either October or December.

Less than one in four say a decision on tapering will be delayed until next year. The Fed is currently buying $85 billion worth of bonds per month.

The Fed began buying $40 billion of mortgage- backed securities per month in September of last year and then supplemented that with $45 billion of Treasury securities in December. Bernanke suggested to reporters on June 19 that the program might be wound up by the middle of next year.

Investors aren’t convinced. Only 16 percent of those polled expect the Fed to have stopped buying assets by then. One in three thinks the purchases will end later in 2014, while 44 percent don’t expect them to end until 2015 or afterward.

“The tapering will be very gradual,” Robert Kopp, a poll participant and principal at asset management company Systra in Chicago, said via email. The Fed will wait to “see the impact on the market before deciding the next steps.” Kopp sees the asset purchases continuing through 2014.