The United States Federal Reserve (Fed) announced this Wednesday that it is increasing the reduction of its bond purchase program in December from 15,000 to 30,000 million dollars and to 60,000 as of January, which accelerates the withdrawal of monetary stimulus and opens the door to a possible rise in interest rates in the first half of 2022.
In its statement at the end of its two-day meeting, the US central bank left interest rates in the range between 0% and 0.25% unchanged for the moment, despite the fact that inflation stood at a year-on-year rate of 6.8% in November, the highest figure in almost 40 years in the United States.
With this decision, taken unanimously, the volume of monthly bond purchases, which during most of the pandemic was $ 120 billion, has already been lowered to $ 75 billion.
In parallel, the Fed lowered its forecasts for economic growth in the United States to 5.5% this year, four tenths less than in September, while it raised inflation forecasts to 5.3%, compared to 4.2% previously estimated.
By 2022, however, the central bank estimates that inflation in the US will moderate to 2.6%, four tenths less than it was calculated in September, and forecasts that growth will be 4%, two tenths more than expected at the time.
Fed Chairman Jerome Powell is scheduled to hold a press conference on Wednesday to comment on the monetary decision.
The Canadian News
Canada’s largets news curation site with over 20+ agency partners