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Opinion
Mohamed A. El-Erian

Fed Forced to Run Triple Option With Time Running Out

Analysts have revised their 2022 expectations to include the end of large-scale asset purchases, four rate increases and the beginning of balance-sheet contraction. It’s a risky hurry-up offense.

Can he run the two-minute drill?

Can he run the two-minute drill?

Photographer: Al Drago/Bloomberg

The final weekend of the regular National Football League season was full of close games, including some with memorable comebacks involving the so-called two-minute drill — that is, the necessity for teams to pivot to a hurry-up offense that holds the promise of winning the game but comes with heightened risk of loss. A similar pivot is in the future of the Federal Reserve — a view that is consistent with what has been a sharp move in analysts’ forecasts of central bank policy actions.

In the last few days, a number of widely followed Wall Street analysts have revised their 2022 expectations for U.S. monetary policy to include the end of large-scale asset purchases, four rate increases and the beginning of balance-sheet contraction.