{"id":123651,"date":"2021-12-03T15:37:50","date_gmt":"2021-12-03T15:37:50","guid":{"rendered":"https:\/\/fin2me.com\/?p=123651"},"modified":"2021-12-03T15:37:50","modified_gmt":"2021-12-03T15:37:50","slug":"imf-urges-the-fed-to-speed-up-monetary-policy-tightening-amid-mounting-inflation-fears","status":"publish","type":"post","link":"https:\/\/fin2me.com\/markets\/imf-urges-the-fed-to-speed-up-monetary-policy-tightening-amid-mounting-inflation-fears\/","title":{"rendered":"IMF urges the Fed to speed up monetary policy tightening amid mounting inflation fears"},"content":{"rendered":"<ul>\n<li>Earlier this week, Fed Chairman Jerome Powell said the central bank could step up its tapering efforts and that this would likely be discussed at a meeting this month.<\/li>\n<li>Data released in November showed that the U.S. consumer price index rose 6.2% in October from a year ago \u2014 hitting its highest level in 30 years.<\/li>\n<li>But the Fed has said market players shouldn&#x27;t interpret tapering as a sign of an imminent rate hike.<\/li>\n<\/ul>\n<p>The U.S. Federal Reserve should tighten monetary policy at a faster pace in light of rising inflation risks, the International Monetary Fund said on Friday.<\/p>\n<p>The Fed decided in early November to start tapering \u2014 which refers to a reduction in the amount of bonds it purchases \u2014 &quot;later this month&quot; at a pace of $15 billion every month. However, with the identification of a new Covid variant and inflation running above target, the IMF argued this pace should be accelerated.<\/p>\n<p>&quot;We see grounds for monetary policy in the United States \u2014 with gross domestic product close to pre-pandemic trends, tight labor markets, and now broad-based inflationary pressures \u2014 to place greater weight on inflation risks as compared to some other advanced economies including the euro area,&quot; the IMF said in a blog post.<\/p>\n<p>&quot;It would be appropriate for the Federal Reserve to accelerate the taper of asset purchases and bring forward the path for policy rate increases.&quot;<\/p>\n<p>Speaking earlier this week, Fed Chairman Jerome Powell indicated that the central bank could step up its tapering efforts and that this would likely be discussed at a meeting this month.<\/p>\n<p>Data released in November showed that the U.S. consumer price index rose 6.2% in October from a year ago \u2014 hitting its highest level in 30 years.<\/p>\n<p>However, when it comes to raising interest rates, the Fed has said that market players should not interpret tapering as a sign of an imminent rate hike.<\/p>\n<p>In this context, the IMF is asking central banks, not just the Federal Reserve, to communicate their plans clearly.<\/p>\n<p>&quot;It is essential for major central banks to carefully communicate their policy actions so as not to trigger a market panic that would have deleterious effects not just at home but also abroad,&quot; the IMF said.<\/p>\n<p>Not everyone believes central banks should speed up their tightening however.<\/p>\n<p>Anne Richards, CEO of Fidelity International, on Tuesday urged policymakers to hold off on acting hastily.<\/p>\n<p>&quot;I do subscribe strongly to this view that it&#x27;s better to wait a month or two months and just be clear on the data path before acting. I think that is a lesser evil than acting prematurely to tighten,&quot; she said.<\/p>\n<p>Source: <a href=\"https:\/\/www.cnbc.com\/2021\/12\/03\/imf-urges-fed-to-speed-up-policy-tightening-amid-rising-inflation-risk.html\" target=\"_blank\" rel=\"noopener\">Read Full Article<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Earlier this week, Fed Chairman Jerome Powell said the central bank could step up its tapering efforts and that this would likely be discussed at [&#8230;]<\/p>\n","protected":false},"author":3,"featured_media":123650,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.7 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>IMF urges the Fed to speed up monetary policy tightening amid mounting inflation fears - Fin2me<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/fin2me.com\/markets\/imf-urges-the-fed-to-speed-up-monetary-policy-tightening-amid-mounting-inflation-fears\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"IMF urges the Fed to speed up monetary policy tightening amid mounting inflation fears - 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