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Fed Officials Weigh Pruning Balance Sheet by $95 Billion a Month

  • Caps could be phased in over three months or bit longer
  • Many officials saw one or more half-point hikes going forward
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Minutes Signal Fed to Shrink Balance Sheet by $95B/Month
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The Federal Reserve signaled it will reduce its massive bond holdings at a maximum pace of $95 billion a month, further tightening credit across the economy as the central bank raises interest rates to cool the hottest inflation in four decades.

Minutes of their March meeting released Wednesday also showed that “many” officials would have favored raising rates by a half-percentage point last month -- but deferred to a quarter-point move in light of Russia’s invasion of Ukraine -- and viewed one or more half-point increases as possibly appropriate going forward if price pressures fail to moderate.