“It is paramount to keep inflation down.”
(Photo: AP)
Washington According to Director Lael Brainard, the US Federal Reserve will put a stop to inflation with a series of interest rate hikes and an imminent melting of the balance sheet. “It’s paramount to keep inflation down,” she said Tuesday at a Minneapolis Fed conference.
The central bank will therefore continue to “methodically” tighten monetary policy. There will be a series of rate hikes. In addition, the balance sheet will be evaporated at a rapid pace from May.
Brainard emphasized that the portfolio, which was inflated to almost nine trillion dollars in the corona crisis, is being reduced at a much faster pace than in the last contraction from 2017 to 2019. US Federal Reserve Chairman Jerome Powell had already signaled that the central bank could start reducing its balance sheet, which had been massively inflated by bond purchases, in May. Experts are hoping for an insight into the plans from the minutes of the most recent interest rate meeting, which will be published on Wednesday.