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The Fed Is Expected To Accelerate The End Of Loose Monetary Policy


Inflationary pressures have intensified recently, and the new mutant strain Omicron has caused global panic. Federal Reserve (Fed) Chairman Jerome Powell said that the Fed may end its loose monetary policy sooner than expected, and will discuss speeding up cuts at the December regular meeting. debt. This hawkish remark caught the market by surprise, causing stock markets to fall and the yield curve of U.S. Treasuries to flatten. CNBC, The Wall Street Journal, and other foreign media reported that Powell said frankly when attending the Senate Banking Committee hearing on November 30 that "the Fed did not predict the problem of supply chain disruption", "increased risk of increased inflation", and "stopped communications." Puffiness is a temporary statement." Under this circumstance, the Fed is expected to accelerate the pace of ending loose monetary policy in order to deal with the risk of rising inflation. Powell said that he expects the Fed to discuss speeding up the reduction of debt purchases at its December regular meeting and complete its exit months earlier than previously expected. At its regular meeting in November, the Fed will reduce its monthly asset purchases of US$120 billion by US$15 billion in November and December. At this rate, it is estimated that it will be able to withdraw completely before June next year.
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