Fed minutes: US Federal Reserve aims to reduce bond purchases this year | news

The restriction on the purchase program could begin in mid-November or mid-December, according to the minutes (minutes) of the meeting of the US Federal Reserve from September 21-22, published on Wednesday. If the economic recovery continues, the bond purchases could expire around mid-2022, it said.

The US Federal Reserve is currently buying government and mortgage bonds worth US $ 120 billion a month to support the economy. According to experts from the analysis house Capital Economics, the Fed will decide to reduce bond purchases at the interest rate meeting in early November. The last disappointing labor market report for September should therefore not delay the decision.

As the log further shows, the reduction in the purchase program could take place in monthly increments. Accordingly, a monthly reduction in purchases of government bonds by ten billion dollars and other securities by five billion dollars is possible.

According to some members of the central bank, the current material bottlenecks in the manufacturing sector could mean that price pressure will persist for longer than expected. In September inflation in the United States rose surprisingly to 5.4 percent. Economists had expected an unchanged rate of 5.3 percent on average. As inflation rose, it returned to the level of the summer months of June and July, when the rate had reached its highest level since 2008.

The central bank is only aiming for a rate of two percent. The Fed has made it clear over and over again that it sees the rise in inflation as a passing phenomenon.

The financial markets were not lastingly moved by the publication of the minutes. Investors have already been expecting the reduction in bond purchases to begin this year.

/ jkr / he

WASHINGTON (dpa-AFX)

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