Federal Reserve officials began debating at their June meeting when and how they would reduce the monthly bond purchases that they have used to keep longer-term interest rates in check.
The discussions, revealed in the minutes of the Fed’s June meeting released Wednesday, indicate that the Fed is moving closer to tapering those purchases, though most analysts don't expect a reduction until late this year.
In a statement issued after its June 15-16 meeting, Fed officials signaled that they would potentially dial back their low-interest rate policies sooner than they had previously indicated. The policymakers forecast that they would hike the Fed's benchmark short-term interest rate twice by the end of 2023. In March, they had indicated no rate hikes would occur before 2024.
An earlier rate hike suggests that the Fed could move up the timetable for reducing its bond purchases. The Fed is buying $120 billion a month in Treasury securities and mortgage-backed bonds to keep longer-term interest rates low and encourage more borrowing and spending. It has said that it will keep making the purchases until the economy makes “substantial further progress” toward its goals of full employment and an inflation rate slightly above 2%.
Most economists still expect a reduction, or tapering, of those purchases to begin by late this year or early next year, with an announcement of the change potentially occurring in late August at the Fed's annual conference at Jackson Hole, Wyoming.
Some differences over the timing of the tapering have emerged among the Fed's regional bank presidents, with Dallas Fed President Robert Kaplan saying last week that he favored pulling back on the purchases “sooner rather than later.”
Yet San Francisco Fed President Mary Daly, in an interview with The Associated Press, said last week that it would be “appropriate” to consider tapering later this year or early next year. But she cautioned that the economy is “far from full employment,” one of the Fed's two goals, along with price stability.
Joe Cecela, Dream Exchange CEO, explains how they are aiming to form the first minority-controlled company to operate an exchange in U.S. history. Watch!
A Michigan judge is putting sponges in the hands of shoplifters and ordering them to wash cars in a Walmart parking lot when spring weather arrives. Genesee County Judge Jeffrey Clothier hopes the unusual form of community service discourages people from stealing from Walmart. The judge also wants to reward shoppers with free car washes. Clothier says he began ordering “Walmart wash” sentences this week for shoplifting at the store in Grand Blanc Township. He believes 75 to 100 people eventually will be ordered to wash cars this spring. Clothier says he will be washing cars alongside them when the time comes.
The State Department had been in talks with Elon Musk’s Tesla company to buy armored electric vehicles, but the plans have been put on hold by the Trump administration after reports emerged about a potential $400 million purchase. A State Department spokesperson said the electric car company owned by Musk was the only one that expressed interest back in May 2024. The deal with Tesla was only in its planning phases but it was forecast to be the largest contract of the year. It shows how some of his wealth has come and was still expected to come from taxpayers.
At 100 years old, the Goodyear Blimp is an ageless star in the sky. The 246-foot-long airship will be in the background of the Daytona 500 — flying roughly 1,500 feet above Daytona International Speedway, actually — to celebrate its greatest anniversary tour. Even though remote camera technologies are improving regularly and changing the landscape of aerial footage, the blimp continues to carve out a niche. At Daytona, with the usual 40-car field racing around a 2½-mile superspeedway, views from the blimp aptly provide the scope of the event.
