Fed’s Harker: Bond Buying to Continue until 2022

The President of the Federal Reserve Bank of Philadelphia, Patrick Harker, said on Thursday that he expects the United States Federal Reserve to continue with its bond buying activity at least until the end of 2021, Reuters reported.

The continuity of asset purchases at the current pace depend on the

“I don’t see us paring that back right now, or in the near future.”

“I could see potentially that occurring at the very end of 2021 or early 2022, but it is all going to depend on the course of the economy which will depend on the course of the virus.”

Moreover, Harker said that due to the resurgence of the Coronavirus pandemic with a new wave, economic growth could turn negative during the first quarter (Q1) of the year.

“We are looking at a long period where the Fed funds rate will stay at essentially zero,” he added, noting that there are no signs that inflation is going to go out of control.

Harker further noted that the vaccination rate in the U.S. has been incredibly disappointing so far.

It is worth noting that it was expected that by the end of 2020 around 20 million people in the U.S. will receive that vaccine, however, a little over 4 million people have been vaccinated so far.