Reuters
Fed minutes likely to provide details on rate hikes, balance sheet reduction
The release on Wednesday of the minutes of the Federal Reserve’s last policy meeting is likely to shed light on the U.S. central bank’s plans to trim its massive balance sheet and hike interest rates in 2022 as well as update its shifting view of inflation. The document, due at 2 p.m. EST (1900 GMT), will provide an accounting of the Jan. 25-26 meeting, in which policymakers agreed that it would “soon be appropriate” to raise the Fed’s benchmark overnight interest rate from its near-zero level, and also engaged in extensive discussion about the future of nearly $9 trillion in securities held by the central bank. Debate around both topics and the range of views expressed about the severity of the ongoing inflation surge and other economic risks may hint at just how aggressive the Fed plans to be in tightening monetary policy, and in particular how likely it is to inaugurate a round of rate hikes in March with a half-percentage-point increase in its target rate.
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