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However, the interesting point is that during the same period, the US deficit increased by USD 333 bil, hence the Fed has actually purchased more than the deficit increased by, during the last 5 months.

The rumours buzzing around are that the Fed will eventually reduce the size of its current USD 85 bil asset purchase program, which may result in interest rates moving and the stock market taking a hit. 

But what if, due to inflationary pressure, the Fed were to exit completely from the asset purchase program? And furthermore, it deliberately failed to elucidate the situation?  What bout if the Fed start selling bonds.

So what is the new trade correlation? In past years it has been strong USD and strong treasury market, but recently we have seen the opposite, weak USD and weak treasury market. 

Datum	FED-Bestand an US-Treasuries
31.12.2012	USD 1,656 Mrd.
31.05.2013	USD 2,011 Mrd.
FED-Käufe	USD 355 Mrd.

Datum	FED-Bestand an US-Treasuries
31.12.2012	USD 1,656 Mrd.
31.05.2013	USD 2,011 Mrd.
FED-Käufe	USD 355 Mrd.