Tapering asset purchases could start this year, says Powell
Last Friday the Federal Reserve Bank of Kansas City held the 2021 Economic Policy Symposium “Macroeconomic Policy in an Uneven Economy”. The virtual event was focused on current economic challenges in the financial market and workable policy solutions.
During Federal Reserve Chairman Jerome Powell’s opening remarks, which can be watched here, he stated that the outlook for the labor market has “brightened considerably in recent months” with job gains rising steadily over the year even with Delta variant cases on the rise.
Powell noted while the “sharp run-up in inflation” is concerning, it is “tempered by a number of factors that suggest that these elevated readings are likely to prove temporary. This assessment is a critical and ongoing one, and we are carefully monitoring incoming data.”
On a highly anticipated subject, Powell indicated that the central bank is likely to begin tapering asset purchases before the end of the year. Powell noted that the economy has now met the “substantial further progress” goal for inflation and saw “clear progress” in the labor market.
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