Federal Reserve to Start Tapering Pandemic-Era Stimulus
AllSides Summary
The Federal Reserve announced Wednesday that it would begin tapering off its pandemic-era surge in monthly asset purchases this month. “It is time to taper,” Fed Chairman Jerome Powell said, “because the economy has made substantial progress towards our goals.” The central bank began buying billions of dollars of bonds and other assets in March 2020 to support the economy through the pandemic. However, the U.S. economy has recently seen higher sustained inflation and less GDP growth than expected. Powell maintained his position that inflation was largely “transitory,” saying that “like most forecasters,” he believed annual price increases would move closer to the Fed’s 2% goal as supply chains recovered from current disruptions.
Coverage was most prominent in center-rated business outlets. Some of these outlets tied the Fed’s announcement to several U.S. stock indexes hitting record highs on Wednesday.
Featured Coverage of this Story
From the Left
Fed set to begin pulling plug on massive aid to economy
The Federal Reserve said Wednesday it will begin to slow its massive bond purchases later this month, the first step in removing its extraordinary pandemic-era support for the economy.
The long-awaited move signals both optimism about the pace of job growth and wariness about price surges that have pushed inflation up to its highest level in decades. The central bank has been buying $120 billion a month in U.S. government debt and mortgage-backed securities, a process designed to supercharge its efforts to keep borrowing costs low for households and businesses.
From the Right
Fed to taper bond purchases by $15B a month as it unwinds pandemic-era stimulus
The Federal Reserve on Wednesday announced plans to begin slowing its aggressive bond-buying program by $15 billion a month in mid-November, the first step that policymakers will take in reversing a historic level of stimulus for the U.S. economy amid a recent inflation surge.
The Federal Open Market Committee said at the conclusion of its two-day policy-setting meeting this week that it would lower its monthly purchase of long-term Treasury bonds by $10 billion a month and monthly purchase of mortgage-backed securities by $5 billion a month, bringing the total November purchase to $105...
From the Center
Fed to start tapering bond purchases later this month as it begins pulling back on pandemic aid
The Federal Reserve announced Wednesday it soon will begin reducing the pace of its monthly bond purchases, the first step toward pulling back on the massive amount of help it had been providing markets and the economy.
Tapering of bond purchases will start “later this month,” the policymaking Federal Open Market Committee said in its post-meeting statement. The process will see reductions of $15 billion each month -- $10 billion in Treasurys and $5 billion in mortgage-backed securities – from the current $120 billion a month that the Fed is...
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