Federal Reserve officials are signaling that they will take a more aggressive approach to fighting high inflation in the coming months.
Tom Williams / Pool via AP fileWASHINGTON — Federal Reserve officials are signaling that they will take a more aggressive approach to fighting high inflation in the coming months — actions that will make borrowing sharply more expensive for consumers and businesses and heighten risks to the economy.
The plan to quickly draw down their bond holdings marks the latest move by Fed officials to accelerate their inflation-fighting efforts. Prices are rising at, and the officials in recent speeches have expressed increasing concern about getting inflation under control. Many economists have said they worry that the Fed has waited too long to begin raising rates and that the policymakers might end up responding so aggressively as to trigger a recession.
The Fed bought trillions of dollars of Treasurys and mortgage-backed securities after the pandemic hammered the economy, with the goal of lowering longer-term borrowing rates. It also cut its short-term benchmark rate to near zero. Last month, it increased that rate to a range between 0.25% and 0.5%, its first increase in three years.
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