Policymakers were back in the spotlight last week, with hopes growing that we could now see further monetary and fiscal stimulus. Unfortunately, we doubt that the Fed will have much success with what has been dubbed Operation Twist. Extending the average maturity of its Treasury holdings might lower long-term interest rates a little, but the impact on the wider economy would be negligible. Meanwhile, President Obama will struggle to get his proposed $450bn jobs stimulus passed by an otherwise hopelessly divided Congress.
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