Monetary policy exit strategies pick-up momentum

We have the following on the monetary exit front:

Fed talking about exit strategy in WSJ. Officials saying they will have to be as aggressive in the exit as in the easing. The Fed is also closing some of their less active lending programs given there is not a strong market demand. Spreads have tighten so the credit easing programs are less necessary.

ECB cutting some of the longer-term lending programs as an precursor for exit. Although now we are hearing that ECB Trichet is worried about "sharp" currency moves.

BOJ is planning to end their emergency corporate debt-buying program. Corporate bonds have done especially well in Japan. This was a program started last December and extended in July. This action is expected even after the Tankan report which suggests that investment cuts will continue and the recovery in Japan will be slow. This is after an increase in confidence.

The exit plans will be slow but this will start to loosen the high correlation in interest rates within the G10.