The Wall Street Journal reports that Fed officials are weighing an early end to the balance sheet reduction scheme. The Federal Reserve is reducing its balance sheet in a move that was announced by then-Chair Janet Yellen in September 2017.
Fed Chair Jerome Powell said that the program to reduce the balance sheet, also known as Quantitative Tightening, is on “autopilot”, spooking financial markets. In later comments, Powell opened the door to changing the policy if necessary.
The report by the WSJ suggests that officials at the central bank could make a decision soon. The scheme will be central in the FOMC decision due on Wednesday. Any decision or mention could boost markets and weigh on the US Dollar.
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