Federal Reserve Jerome Powell testifies during a Senate Banking Committee hearing on “The Quarterly CARES Act Report to Congress” on Capitol Hill in Washington, U.S., December 1, 2020.
Susan Walsh | Reuters
The Federal Reserve’s all-important policy meeting this week is going to affect where investors put their money to work going forward.
The Federal Open Market Committee, which will conclude its two-day meeting Wednesday, could start preliminary discussions about scaling back the unprecedented bond-buying programs that aided the economy during the pandemic. Some market participants believe it’s still too soon for the central bank to signal such a tapering action, while others think the Fed will be able to find a happy medium that won’t upset the markets.
Each scenario has different investing implications as they are expected to make big moves across asset classes.
Here’s a playbook for traders on every scenario from the central bank’s key meeting.