Marriner S. Eccles Federal Reserve Building in Washington, DC, USA, Friday, February 19, 2021.
Photographer: Samuel Corum / Bloomberg
Photographer: Samuel Corum / Bloomberg
At their meeting last month, Federal Reserve officials said they would probably need more time before reducing their massive bond-buying program.
“Participants noted that it will probably be some time before substantial progress is made towards the maximum objectives of the Committee on Employment and Price Stability. ” minutes from the meeting of the Federal Open Market Committee on March 16-17 published on Wednesday.
“A number of participants emphasized the importance of clearly communicating the assessment of progress towards its long-term objectives, before the Committee could be considered substantial enough to justify a change in the pace of asset acquisitions.”
US central banks have left their $ 120 billion-a-month asset purchase program unchanged at the meeting and forecast that they will keep the benchmark lending rate close to zero until at least 2023. Despite a sharp update in their forecasts. growth this year amid rising confidence and the fiscal stimulus round.
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As an explanation, Fed Chairman Jerome Powell told reporters after the meeting that the economy is “a long way” from maximum employment and sustainable 2% inflation. He added that “it may take some time for substantial progress to be made”, referring to the threshold set by officials for reducing asset purchases.
There were interest rates on time prices in the likelihood of a rate hike in the second half of 2022. Michael Gapen, chief US economist at Barclays in New York, said some of the tension stems from uncertainty in the mapped outlook over uncertainty about how The Fed will respond to the actual data.
Non-farm wages have increased by 916,000 jobs last month as increased vaccinations and reduced state restrictions boosted the recovery in the labor market, government data released on Friday showed. But Fed officials said they were looking at a broad picture store conditions. Other values, such as labor force participation, are still below the levels observed in the last expansion.
(Updates with more than the minutes in the third paragraph.)