U.S. Economic Outlook: Liquidity Surge Anticipated Post-Government Reopening

According to BlockBeats, Raoul Pal, co-founder and CEO of Real Vision, has shared insights on the macroeconomic trajectory following the reopening of the U.S. government. He predicts that in the coming days, the U.S. Treasury General Account (TGA) will significantly boost market liquidity, a trend expected to persist for several months. Quantitative tightening (QT) is anticipated to conclude in December, with the balance sheet beginning a gradual increase. Consequently, the U.S. dollar is likely to weaken again. Pal suggests that policymakers' next critical move is to prevent a year-end liquidity crunch. He foresees the introduction of several "temporary" measures to enhance liquidity, with regular financing and the Standing Repo Facility (SRF) operations being the most probable. Debt must be rolled over, and the government aims to stimulate the economy ahead of the midterm elections. Overall, a wave of liquidity is expected to flood the market.