One by one, Fed officials are getting behind the idea that their asset purchases should be dialed back soon. Whether this is announced in September or November doesn’t matter much. What matters is that the Fed is years ahead of the ECB and BoJ in the normalization game. The dollar held its ground recently even as US yields crumbled, so it could really shine once tapering gets rolling and Congress delivers even more fiscal juice. 

Falling into line

More and more Fed officials are throwing their weight behind withdrawing some liquidity in the next few months. First it was just Kaplan. Then it was Bullard. Last week it was Vice Chairman Clarida, Waller, and Daly joining this group. This week, their views were echoed by Bostic and Rosengren.

The Fed can afford to take its foot off the accelerator because the US economy is booming. Inflation is scorching hot, consumption is off the charts, and the labor market is healing its…

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