Fed to speed up tapering, publish new dot plot

Fed Chair Jerome Powell has clearly indicated that there will be a discussion about accelerating the tapering pace, and ending the asset purchases a a few months early. We’d expect Fed to announce a decision today, probably a double in the size of tapering to USD 30B per month.

The main focus will be more on the new economic projections, in particular the dot plot. Back in October, nine policy makers penciled in one rate hike or more in 2022 (six expected one hike and three expected two hikes), while nine expected no change. We’d probably see the interest rate projections shift even more towards the hawkish side.

Here are some suggested previews:

• FOMC Preview – Fed to Double Size of QE Tapering
• Fed Meeting: Faster Taper Looms But What Will The Dot Plot Reveal?
• What To Expect From The Fed’s Final 2021 Meeting?