Fed to accelerate withdrawal of economic aid as prices surge

By CHRISTOPHER RUGABER
AP Economics Writer

WASHINGTON (AP) — Under Chair Jerome Powell, the Federal Reserve is poised this week to execute a sharp turn toward tighter interest-rate policies with inflation accelerating and unemployment falling faster than expected. The Fed will likely announce that it will reduce its monthly bond purchases at twice the rate that Powell had outlined just six weeks ago. Those bond purchases are intended to lower longer-term rates, so winding them down more quickly — likely by early spring — will lessen some of the economic aid the Fed supplied after the pandemic erupted last year. Fed officials are also expected to forecast that they will raise their benchmark short-term rate two or three times next year.