The Fed’s Inflection Point

The Federal Reserve has reached an inflection point. As they complete the last rounds of their bond-buying programs, Federal Open Market Committee members must now decide how quickly to bring short-term interest rates back to more normal levels from their current settings of near zero. Thanks to informative statements, both in the minutes of FOMC meetings (such as those released today) and in speeches given by individual members over the past several months, we now have a very clear idea of how Fed policymakers plan to make these important interest rate decisions.