Wall Street firms expect the Federal Reserve to start paring back its bond-buying next year, and phase it out completely by the second half of 2023, the New York Fed’s latest survey of primary dealers shows.
The Fed has since June said it will buy “at least” $120 billion a month in Treasuries and mortgage-backed securities “over coming months,” but has not given any precise guidance on its asset-purchase plans. It has bought about $3 trillion since the start of the crisis to help stabilize financial markets and boost the economy.
The Fed is expected to taper purchases further in 2022, to a monthly average of about $25 billion by the second half, according to the survey. They also seem at odds with the Fed’s own guidance on keeping monetary policy super easy for years to come.
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