Chart of the Week!

The FOMC delivered a hawkish surprise, with the median forecast now suggesting two rate hikes in 2023. With average inflation already on track to exceed 2% in 2021 and the economic recovery apace, we think that asset purchase tapering will begin early 2022. Policymakers will remain attuned to data, but liftoff could be delayed by lower-than-expected inflation, or a sharper deceleration in growth as fiscal support fades.