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06.04.2017, 05:47

There was detailed discussion of ending the reinvestment policy - FOMC meeting minutes

The Federal Reserve is ready to start to shrink their bloated $4.5 trillion balance sheet this year, the minutes of the March monetary policy meeting revealed, cited by rttnews.

At the March 14-15 meeting, FOMC members voted at the meeting to raise interest rates a quarter-point while projecting two further rate hikes this year.

There was detailed discussion of ending the reinvestment policy, with policy makers unsure whether to phase out reinvestment of principal payments or cutting them off at once by year's end.

This is seen as a nod to the improving economy and prospect of strong medium-term economic growth.

Provided that the economy continued to perform about as expected, "most participants anticipated that gradual increases in the federal funds rate would continue and judged that a change to the Committee's reinvestment policy would likely be appropriate later this year," the minutes said.

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