Last updated: 02:19 / Thursday, 21 February 2019
Stays patient

The Fed is Looking to Prepare a Plan to Stop Reducing its Balance

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The Fed is Looking to Prepare a Plan to Stop Reducing its Balance

The Federal Reserve, which at its meeting on January 29 and 30 decided to keep the reference rate unchanged, said in its minutes, published this Wednesday, that there is greater concern about the risks to the economic growth of the US and that it is open to preparing a plan to stop reducing its balance.

The FOMC continued with the message that it would be "patient" to decide when and how to adjust policy to a growing set of risks, including the slowdown in growth in China and Europe, Brexit, trade negotiations and the effects of the five-week shut-down of the United States government, pointing out to a wait and see aproach about how the economy unfolds with the current policy, indicating that for now it has suspended interest rate increases.

The minutes also show that they are prepared to be more flexible in reducing their overall balance, made up of a 4 trillion dollars portfolio of bonds and other assets: "Almost all participants thought that it would be desirable to announce before too long a plan to stop reducing the Federal Reserve's asset holdings later this year." they point out.

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