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Monday, January 06, 2025 | 02:39 PM ISTEN Hindi

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Status quo on stance but liquidity sugar rush may end

Withdrawal of excess liquidity is akin to taking away the training wheels from a kid's bike. They help a kid maintain balance but don't teach how to ride

Monetary policy review: All eyes on RBI today
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Tamal Bandyopadhyay
At its last meeting, the US Federal Reserve’s rate-setting body, the Federal Open Market Committee (FOMC), opted for status quo but made it clear that tapering of quantitative easing could begin as early as November and end by mid-2022.

Over the next two years, policy rates are likely to move higher. The Fed's dot plot, a chart that summarises the FOMC members’ outlook for the federal funds rate, gives us a sense of how these rates could rise between 2022 and 2024. The Fed has upgraded its inflation projection, which could be more persistent in the medium-term, and lowered its growth
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of www.business-standard.com or the Business Standard newspaper

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