Powell: Fed on track to slow aid for economy later this year

By CHRISTOPHER RUGABER
AP Economics Writer

WASHINGTON (AP) — The Federal Reserve will start dialing back its ultra-low-interest rate policies this year as long as hiring continues to improve, Chair Jerome Powell said Friday, signaling the beginning of the end of the Fed’s extraordinary response to the pandemic recession. Such a move could lead to higher borrowing costs for mortgages, credit cards and business loans. The Fed has been purchasing $120 billion a month in bonds to lower longer-term interest rates and support borrowing and spending. Powell’s comments indicate the Fed will likely announce a reduction, or tapering, of those purchases sometime in the final three months of the year.