According to the minutes of the Fed’s last meeting, balance sheet shrinking plan could be approved at the May meeting.
The Fed released the minutes of the last meeting of the Federal Open Market Committee (FOMC), held on March 15-16, 2022.
It was stated in the minutes that it would be appropriate to narrow the monthly balance sheet of 95 billion dollars. It was also seen that many officials expressed the opinion that one or more 50 basis point increases were warranted. The expectation that the balance sheet reduction plan would be approved at the May meeting also came to the fore. Accordingly, the FOMC is expected to support the balance sheet reduction at its next meeting to be held on May 3-4.
On the other hand, the published minutes showed that “many” officials preferred to increase the interest rate by half a point instead of a quarter-point move. Still, they decided not to do this during Russia’s invasion of Ukraine.