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Next stop for tapering watchers: December.
To the considerable surprise of most observers (but to be fair, far from all), the U.S. Federal Reserve did not announce, at the end of its two-day meeting Wednesday, the start of a gradual reduction in its quanitative-easing (QE) program of government bond and mortgage-backed-security purchases, commonly known as tapering. It’s certainly a significant head-fake from the Fed, which had signalled months ago that September was the likely point at which the QE taper would begin – and had said little in recent weeks to dissuade financial markets from that assumption.