Fed rate-setters pushing for QE slowdown soon

SEVERAL members of the Federal Open Market Committee (FOMC), which makes decisions on US monetary policy, have suggested that reductions in the pace of QE would be justified soon.

The rate-setting FOMC’s minutes, released yesterday, said that opinions had changed since their September meeting, and that some members of the committee had become more confident that a sustained improvement in the economy was underway.

Paul Dales, senior US economist at Capital Economics, said that QE tapering would begin in the third quarter. He said: “the strength of June’s Employment Report, which was released last week, will surely satisfy those members who are more reluctant to pull the trigger”

Bernanke also gave a speech yesterday, standing by his previous comments on tapering, and suggested that there were still good arguments for QE as inflation and employment remain weak.