The Fed is about to wind down its emergency economic stimulus, Jerome Powell hints

Federal Reserve Chairman Jerome Powell Friday said that inflation is more or less under control, the economic recovery is continuing apace and it's time for the Fed to wind down its emergency economic stimulus program. But in his highly anticipated speech at the virtual Jackson Hole Symposium, Powell tempered his optimism with some words of caution: The Delta variant remains a looming threat to the US economy.

Balancing the threat of Covid with the ongoing economic recovery, Powell suggested the Fed, which has been buying $120 billion worth of Treasury and mortgage-backed securities every month since the height of the pandemic to support the economy, will start pumping the brakes on those asset purchases before the end of the year. Interest rates are still near zero as well, though they won't move until the monthly asset purchases are addressed.