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The US Federal Reserve supports monetary tightening and budget cuts
Wednesday, April 6, the Federal Open Market Committee released the minutes of the March 15-16 meeting, and the minutes indicated that Fed officials discussed how to reduce their holdings of trillions of dollars in bonds during the March meeting, with a consensus that the pace of reduction will be $95 billion per month.
The minutes indicated that officials generally agreed to reduce the holding of Treasury bonds by about $60 billion and by about $35 billion of mortgage-backed securities.
The US central bank agreed at the monetary policy meeting last month to implement the first interest rate increase since 2018, by 25 basis points, and officials also discussed the pace of raising interest rates in the future as members tend towards more tight moves.
A number of Fed officials advocate carrying out one or more rate increases of about 50 basis points in upcoming meetings if inflationary pressures remain high.
Inflation in the United States rose to a 40-year high in light of the global supply chain crisis exacerbated by the Russia-Ukraine war.
