In an interview with Reuters on Wednesday, Dallas Fed Chairman Robert Kaplan, argued that the reduction of the Fed’s bond purchases should start soon and be gradual.
Featured statements
“Questioning the effectiveness of Ded’s asset purchase program; it will not speed up the job market matching process.”
“Reducing the Fed’s asset purchases soon gives it flexibility to be patient with interest rate hikes.”
“A faster cut doesn’t mean the Fed will raise rates faster.”
“It is essential to divorce the decision on the gradual reduction from the decision on rates.”
“The gradual reduction could mean cutting monthly purchases of treasuries by $ 10 billion, mortgage-backed securities by $ 5 billion.”
“Seeing the set-up will take about eight months.”
“The delta variant of the coronavirus could slow down job earnings, but it will not slow down recovery unless vaccines are less effective in preventing hospitalizations and deaths.”
“It will reevaluate its own June view next month that raising interest rates in 2022 would be appropriate.”
Market reaction
The US Dollar Index it remains in positive territory following these comments and was last seen gaining 0.2% to 92.25.
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