Fed plans October start for 'gigantic' balance sheet reduction

As expected the Federal Open Market Committee (FOMC) kept rates on hold at a range of 1% to 1.25%, but also announced it will begin the unwinding of the stimulus programme it began close to a decade ago on hopes the US economy will continue to "perform well". In October, the Fed will begin reducing its $4.5trn portfolio in bonds by stopping reinvesting the proceeds of maturing debt accumulated through the various QE programmes. It is hoped the runoff will see reductions in the tens of billions of dollars per month. "The basic message here is that US economic performance has been go...