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Federal Reserve (Fed). One Small Step Closer to Tapering Bond Purchases

July 28, 2021
Mathieu D’Anjou, CFA, Director and Deputy Chief Economist

It was clear that the Fed wouldn’t be announcing any major changes to its monetary policy at its July meeting. It took its first step toward tapering its bond purchases in June, when Fed officials acknowledged having begun discussing the topic. However, a more official signal was needed before announcing a tapering. The primary source of interest in today’s meeting was whether the Fed was sufficiently confident in the recovery, or sufficiently concerned about inflation, to take things further.