Analysts relieved as US Federal Reserve doubles reduction in bond-buying programme

Though they are split on whether three hikes next year is positive

Elliot Gulliver-Needham
clock • 3 min read

The Federal Reserve’s Federal Open Market Committee voted unanimously to double the reduction in its monthly bond purchases to $30bn a month, meaning that the stimulus will now retire in March.

Importantly, though the committee chose to keep interest rates stationary, it predicted three rate hikes in 2022, a sharp increase from previous expectations. Analysts were not surprised by the decision to accelerate the reduction of stimulus, with Ron Temple, co-head of multi-asset and head of US equities at Lazard Asset Management, stating that "with the economy firing on all cylinders, the Fed is right to reduce securities purchases that risk further inflating financial asset prices". Candice Bangsund, vice president and portfolio manager for global asset allocation at Fiera Capita...

To continue reading this article...

Join Investment Week for free

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now

 

Already an Investment Week
member?

Login

More on Markets

Market Movers blog: European markets show signs of life after US Senate passes tax bill

Market Movers blog: European markets show signs of life after US Senate passes tax bill

Latest news and analysis

Investment Week
clock 02 July 2025 • 1 min read
UK fastest growing G7 economy in Q1 2025

UK fastest growing G7 economy in Q1 2025

US records fall in GDP

Patrick Brusnahan
clock 30 June 2025 • 1 min read
Friday Briefing: The markets might not be spooked but they are very worried

Friday Briefing: The markets might not be spooked but they are very worried

Friday Briefing

Eve Maddock-Jones
clock 30 June 2025 • 5 min read
Trustpilot