Question
read the following article and pick specific statements that relate to finance courses such as monetary policy, fiscal policy, federal fund rate, yields, bonds, TIPS
read the following article and pick specific statements that relate to finance courses such as monetary policy, fiscal policy, federal fund rate, yields, bonds, TIPS etc and analyze the examples
One wild card is whether Congress will have resolved a standoff over raising the federal borrowing limit by then. Mr. Powell, speaking more broadly, said a taper would be feasible in November if the overall situation is appropriate for this. Mr. Powell has dismissed talk about rate increases by describing the thresholds for raising rates as more stringent than those to reduce bond purchases. But getting that message to stick could be tricky because new interest-rate projectionsthe so-called dotplotshow officials are eyeing more interest-rate increases. In June, the dot-plot surprised investors by showing most of the officials expected to raise interest rates by at least a half-percentage point in 2023. Their March projections showed most didnt see any increases through 2023. The projections released Wednesday show that half of the officials expected interest rates would need to rise at least 1 percentage point from their current level by the end of 2023, and by another three-quarters of a percentage point in 2024. Kathy Bostjancic, chief U.S. financial economist at Oxford Economics, said it was reasonable to expect officials to want to conclude their bond taper by the middle of next year so that they would have greater flexibility to raise rates sooner if inflation appears to defy earlier expectations that it will return more quickly to the Feds 2% goal. The main catalyst is the fact that inflation has accelerated faster than they previously forecast and is remaining elevated, she said. Officials expect slower growth, higher inflation and higher unemployment this year than they did in June, the projections showed, underscoring the effects of the Delta variant of the coronavirus. For example, Fed officials over the summer had said they expected more Americans to rejoin the workforce as children return to in-person school, unemployment benefits expire and concerns about the virus recede. The Delta variant has muddied that scenario, raising the prospect that continued supply chain disruptions and difficulty in competing for workers could lead to a longer period of shortages and rising prices. It may just be that its going to take more time, said Mr. Powell. These are people who were largely working in February of 2020. Theyll get back to work...It may just take a longer time.
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