Skip to content
The Editors

Powell Should Send a Message on Phasing Out Quantitative Easing

The Federal Reserve must grapple with two risks: that too little demand will stall the recovery, or that too much will force inflation above target. This changes the QE calculation.

Call it substantial progress.

Call it substantial progress.

Photographer: Al Drago/Bloomberg via Getty Images

Investors will be listening closely when Federal Reserve Chair Jerome Powell addresses the Jackson Hole conference of central bankers this week. Powell won’t announce a plan to begin tapering the Fed’s bond-buying program — that will happen, at the earliest, after the central bank’s policy-making committee meets next month — but his remarks will be scoured for any fresh indication of his thinking.

He ought to nudge expectations in the direction suggested lately by some other top Fed officials. Short of making a formal announcement, he should say he’d prefer tapering to start soon and be completed by the spring.