Top Fed officials are proving that the economy is strong enough for the taper to start

Federal Reserve changes

An official in the Federal Reserve has pointed out that the U.S. economy is strong enough for the central bank to cut a major bond-buying program, but encouraged a “patient” approach to raising interest rates.

John Williams, President of the New York Fed, has approved the fiscal reform and introduced a plan for the Fed to cut its $ 120bn monthly program this month.

But he stressed that the need for the Fed to change its policy was far from being met.

“The theme of our financial news is good news: recovery continues to look strong. But the theme is that we need to be patient,” he said at a New York Economic Club event on Monday. and the epidemic takes time to end. “

Williams, who sees the economy growing at 5.5 to 6% this year, said a move to cut the central bank’s purchasing program “could be approved soon”, according to a message from Fed chairman Jay Powell last week.

Powell last week beaten The announcement of the proceedings of the next general meeting in November shows a great deal of support among the bank’s officials to end the promising program by mid-2022.

The Fed said it would continue to buy the Treasury and restitution agencies on a monthly basis until it saw a “significant improvement” in inflation of about 2% with significant activity.

The time the taper was up came to reflect the interest rates, which show the number of Fed officials writing off the 2022. The rate left the Federal Open Market committee of 18 equals next year, at least three times the expected 2023 deadline.

Chicago Fed President Charles Evans told reporters Monday that he is contributing to the 2023 rise and a “slight drop” in interest rates from there.

Powell reiterated last week that the Fed’s threshold for raising interest rates from the current-zero rate is much more difficult than starting a real estate program.

Williams on Monday said the labor market was still on a “long journey” before achieving the Fed’s main goal of employment. Although unemployment has dropped to 5.2%, there are more than 5.3m jobs compared to the pre-epidemic.

Williams also said that the explosion in commodity prices, which has pushed U.S. consumer prices to 13 years, should go away over time as electronic barriers become simpler.

As the risk of the epidemic subsides, he said he expects inflation to return to 2% next year. The list of consumer groups, the Fed rate, is 3.6 percent.

“It is important to remember that even after the purchase is complete, financial sentiment will continue to contribute to the economic and economic stability of 2% of inflation,” he said.

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