As the Federal Reserve battles escalating inflationary pressures, Chairman Jerome Powell suggested on Tuesday that the central bank may step up its efforts to stimulate the economy.
In testimony before a Senate committee, the Fed chairman stated that reducing the pace of monthly bond purchases can be accomplished more quickly than the $15 billion-per-month schedule announced earlier this month.
Powell stated that he anticipates the issue being discussed at the December meeting. "At this point, the economy is very strong, and inflationary pressures are higher, so it is appropriate in my opinion to consider wrapping up the taper of our asset purchases, which we actually announced at the November meeting, perhaps a few months earlier," he said. "I expect we'll talk about it at our next meeting."
The initial tapering schedule would have seen bond purchases end around June; if the committee chooses to accelerate, that could mean a close earlier in the spring, allowing the Fed to raise interest rates at any time after that.
