Fed is already suggesting a turnaround in interest rates for 2022

Federal Reserve Chairman Jerome Powell

The Fed wants to get out of crisis mode soon.

(Photo: Bloomberg)

new York If the economy continues to recover, “then tapering may soon be appropriate”. With these words, US Federal Reserve Chairman Jerome Powell prepared investors for the fact that the Fed could soon shut down its aggressive bond-buying program.

Powell also announced possible rate hikes for the coming year. Nine of the 18 members of the committee expect interest rate hikes in the coming year and thus earlier than previously expected. The key interest rate remains in the low range of 0.0 to 0.25 percent.

The outcome of the two-day Fed meeting was eagerly awaited by investors. They want to know when the Fed will finally act, that is, when it will cut back its bond purchases from the current $ 120 billion a month.

The broad consensus was that the Fed chief has not yet started tapering, as the throttling of bond purchases is called, but has announced it indirectly. That’s exactly how it turned out.

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