Financials Jun 27, 2022 01:33 AM (GMT+8) · EqualOcean
David Malpass, President of the world bank, said that the reduction in the size of the Federal Reserve's bond portfolio is expected to release capital to boost U.S. economic output and avoid recession. Malpass said that the Federal Reserve has a variety of tools, including shrinking its balance sheet, which "will return more funds to the banks". "If banks have more capital, they can lend, or they can lend to the non banking sector of the U.S. economy." He said the influx of capital could help ease the pressure on the supply chain. Malpass said that it would take "several months, maybe even two years" to bring inflation back to 2% year-on-year.