No Rate Hike Until After Taper – Fed Chair Powell

At Fed Chair Jerome Powell’s press conference today, Chair Powell indicated he would not expect to raise rates until after the tapering process is completed. With the anticipated taper process, the Fed will purchase less new bonds per month with the ultimate goal of no new bonds being purchased and stabilizing the Feds balance sheet. Since the Fed has not yet agreed to even begin the taper process, this comment indicates Fed rates will remain flat for quite a while. So there should be plenty of advance notice before a rise in the Fed Funds Rate and correspondingly the Prime Rate.

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