The Federal Reserve is widely expected to announce at the end of its two-day policy meeting on Wednesday that it will start reducing its pandemic-era bond purchases. But the question remains how hawkish policymakers sound when making the announcement.
As higher levels of inflation have persisted, central banks around the globe have begun to signal a willingness to raise interest rates earlier than expected to curb rising prices.
The Bank of Canada this week announced that it will end its asset purchases, but also updated its inflation forecast, which could potentially pull forward its timeline for interest rate increases. The Bank of England in September forecast that inflation would rise above 4 per cent, which it said strengthened the case for tighter monetary policy in the next few years.