Fed: an iron fist in a velvet glove, or vice versa

This week, the Fed confirmed that it was in a hurry to end its asset purchase policy, to put itself in a position to be able to tighten monetary policy to ease inflationary pressures. Tapering will end in mid-March. The higher inflation and the lower unemployment are at that time, the more likely the Fed will be to exit the zero interest rate policy immediately. At this stage, the monetary tightening cycle as described in the FOMC's median scenario is not really aggressive. It re...