The Federal Reserve will most likely halt its quantitative easing program by

Question

Quizplus · Accepted Answer

Selling assets from its portfolio is the most likely way for the Federal Reserve to halt its quantitative easing program as it involves reducing the size of its balance sheet, which has been inflated by the massive purchases of bonds and securities under the program. This reduction in the balance sheet will lead to a decrease in the money supply, which is the primary goal of the quantitative tightening policy. The other options, such as increasing the money supply, raising reserve requirements, or raising the discount rate, would all be counterproductive to the goal of reducing the money supply and ending the quantitative easing program.

The Federal Reserve Will Most Likely Halt Its Quantitative Easing