After the NFP and US Inflation, What About the Plan for the FED to Implement 'Tapering'? - Kakiforex.com - Financial Market Media No. 1 in the World After the NFP and US Inflation, What About the Plan for the FED to Implement 'Tapering'? After the NFP and US Inflation, What About the Plan for the FED to Implement 'Tapering'?
InstaForex

June 11, 2021

After the NFP and US Inflation, What About the Plan for the FED to Implement 'Tapering'?

 Following the United States (US) inflation data published yesterday, what are the developments regarding the Federal Reserve's (Fed) plan to implement measures to reduce asset purchases (tapering) which has been the talk of the market before?


Reuters came up with a survey of more than 100 economists who are of the view that the Fed is likely to announce a strategy to reduce their bond -buying program this August and September, and still will not reduce monthly purchases until early next year.


Following the poll results, stealing the spotlight was a statement by James Knightley, Head of International Economics at ING who wanted to see clearer indications by the Fed at a later Jackson Hole conference event.



The survey also presented an estimate of the reduced value of monthly bond purchases with a projection of around $ 20 billion, split evenly between Treasuries and mortgage-backed securities (MBS).


But for now, the Fed's policy tightening measures with the tapering measure are still not an option after the US NFP jobs report was less encouraging and the inflation rate also declined.


Market analysts also still see the US inflation rate is still not convincing enough for the central bank to change current policy in an effort to support economic growth.


Thus, investors are likely to continue to see the effects of the weak movement of the US dollar in the market for the next few weeks.