Fed Reserve show willingness to hike interest rates, cut balance sheet soon

Federal Reserve officials anticipate a rate hike soon, as they see inflation accelerating and reopening of the economy.

Most participants indicated, during last month's Federal Open Market Committee (FOMC) meeting on Wednesday, that if inflation does not move down as expected, it would be appropriate for the committee to end the easing measures at a faster pace than currently expected.

Participants observed that, in light of the current high level of the Federal Reserve’s securities holdings, a significant reduction in the size of the balance sheet would likely be appropriate.

The financial markets expect that the Federal Reserve will raise the interest rate at its next meeting in March, with five rate increases in total for the current year.

Annual inflation in the United States reached 7.5% in January - the highest in 40 years.