At the previously planned rate of bond purchases, the original monthly purchase volume of $ 120 billion would not have reached zero until June 2022.
(Photo: dpa)
Dusseldorf The US Federal Reserve (Fed) is getting out of its loose monetary policy more quickly: It is throttling its bond purchases even more than before, paving the way for several interest rate hikes in the coming year.
The Fed announced on Wednesday evening that it would cut its purchases of government bonds and mortgage-backed securities by $ 30 billion a month, net. Most recently, this value was $ 15 billion. As of January, the pace could rise to $ 60 billion.
At the pace planned so far, the purchase volume of originally 120 billion dollars per month would not have melted to zero until June 2022. Now it could be so far in the spring. The completion of the process known as “tapering” is a prerequisite for an interest rate hike.