By Reuters Staff
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LONDON (Reuters) - The Bank of Canada set the taper ball rolling last week, becoming the first major central bank to cut back on pandemic-era money-printing stimulus programmes. So who’s next?
FILE PHOTO: A sign is pictured outside the Bank of Canada building in Ottawa, Ontario, Canada, May 23, 2017. REUTERS/Chris Wattie
The big guns of central banking - the U.S. Federal Reserve, European Central Bank and the Bank of Japan - won’t officially pare stimulus for a while, a message the BOJ reinforced on Tuesday and one the Fed is expected to reiterate on Wednesday.
US central bankers, charged with keeping prices steady along with getting the economy to full employment, say the pain will soon pass and much of the coming pickup in inflation should peter out after several months.
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NEW YORK (Reuters) - Investors will be scrutinizing the Federal Reserve’s comments at the close of its policy meeting this week, which will come on Wednesday, for insight into the central bank’s thinking on inflation, bond purchases and risks to the financial system posed by soaring asset prices.
FILE PHOTO: The Federal Reserve Board building on Constitution Avenue is pictured in Washington, U.S., March 27, 2019. REUTERS/Brendan McDermid/File Photo
Here are some questions investors may have:
(GRAPHIC: Inflation watch - )
WHERE IS INFLATION HEADED?
Trillions of dollars in federal stimulus spending coupled with an economic reopening as more Americans get vaccinated against the coronavirus has investors staring at the specter of overheating prices.
Research group warns Fed ignoring money supply at its peril
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. Updated: 27 Apr 2021, 05:07 PM IST The Wall Street Journal
It also said that at a time when worries about inflation are on the rise, measuring money growth is critical to understanding what will happen to price pressures
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The Federal Reserve has for years been pulling back on producing data detailing U.S. money supply, and that is a big mistake, according to the Center for Financial Stability. While money is increasingly driving economic and financial market activities, the Fed “seems less committed to actually measuring monetary quantities, the research center said in a note on Monday. It also said that at a time when worries about inflation are on the rise, measuring money growth is critical to understanding what will happen to price pressures, adding that the Fed’s pullback on money data is at odds with its legal mission.