Federal Reserve to wind down stimulus

US Federal Reserve Chairman Jerome Powell said the economy is making steady progress, mainly in employment. He indicated that the Fed will start scaling back quantitative easing measures by the end of the year.

Powell made the comments on Friday during an online version of the Fed's annual economic symposium.

He said that if the economy evolves broadly as anticipated, it could be appropriate to start reducing the pace of asset purchases this year.

The Fed increased its purchases of US government bonds starting in March 2020 to support the economy during the coronavirus pandemic.

Powell did not say exactly when the Fed will scale back its bond purchases.

He said he is closely watching how the spread of the Delta variant is affecting the economy.

He added that policymakers have not made a decision to raise interest rates.

He said the timing and pace of the coming reduction in asset purchases will not be intended to carry a direct signal regarding the timing of interest rate liftoff.