Fed to start faster phase-out plan from January – Goldman Sachs

Federal Reserve Chair Jerome Powell listens as US President Joe Biden nominates him for a second four-year term in the South Court Auditorium of the Eisenhower Executive Office Building in the White House in Washington, US, Nov. 22, 2021. REUTERS/Kevin Lamarque /File Photo

LONDON, Nov. 25 (Reuters) – The US Federal Reserve is likely to double the pace of tapering January’s monthly bond purchases to $30 billion, phasing out its pandemic-era bond buying plan by mid-March, Goldman Sachs strategists said in a daily note on Thursday.

“The increased openness to accelerating the pace of tapering likely reflects both slightly higher-than-expected inflation in the past two months and greater reassurance among Fed officials that a faster pace would not shock financial markets,” analysts led by Jan said. Hatzius in a customer. Remark.

Despite the accelerated winding-down calendar, Goldman does not expect the Fed to raise interest rates a total of three times in 2022 until June. of two.

The minutes of the central bank’s policy meeting on Nov. 2-3 showed that several policymakers said they would be open to accelerating the phasing out of their bond-buying program if high inflation persisted, and that they would faster to raise interest rates. read more

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Reporting by Saikat Chatterjee Editing by Tommy Wilkes

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