FED News: March FOMC Minutes Reveal Internal Debate Over QT Slowdown

The post FED News: March FOMC Minutes Reveal Internal Debate Over QT Slowdown appeared first on Coinpedia Fintech News The March FOMC meeting minutes revealed a quiet tug-of-war inside the Federal Reserve. The central bank recently decided to sharply slow down its balance sheet reduction, also known as quantitative tightening (QT), dropping Treasury runoff caps from $25 billion to $5 billion per month. While this move had broad support, the minutes show it wasn’t without internal pushback. Some policymakers, including Governor Christopher Waller, weren’t happy with the slowdown and preferred to stay on track with the original QT pace. We have posted the minutes from the #FOMC meeting held March 18-19, 2025: https://t.co/PgN9O5QmoS — Federal Reserve (@federalreserve) April 9, 2025 Debt Ceiling Concerns Prompt Policy Shift The slowdown in QT was influenced heavily by ongoing uncertainty around the U.S. debt ceiling. A presentation from a New York Fed official highlighted that slowing the drawdown would act as a buffer, helping preserve liquidity during a period of constrained government borrowing. The Fed aimed to prevent a sharp drop in reserves that could follow a resolution to the debt ceiling situation. In the March 18–19 meeting, the central bank decided to reduce the Treasury runoff limit while maintaining the $35 billion cap on mortgage bond drawdowns. This approach gives the Fed flexibility to manage money market conditions while monitoring the broader economic impact of federal debt management. Fed Signals a Long-Term Shift in Strategy Fed Chair Jerome Powell and New York Fed President John Williams indicated that the reduced pace of QT could continue even after the debt ceiling issue is resolved. Powell emphasized that slowing QT extends the timeline before reserves become scarce, allowing the Fed to make decisions based on a clearer understanding of market conditions. Williams noted that a gradual approach helps avoid unnecessary disruptions and allows time to assess liquidity accurately. .article-inside-link { margin-left: 0 !important; border: 1px solid #0052CC4D; border-left: 0; border-right: 0; padding: 10px 0; text-align: left; } .entry ul.article-inside-link li { font-size: 14px; line-height: 21px; font-weight: 600; list-style-type: none; margin-bottom: 0; display: inline-block; } .entry ul.article-inside-link li:last-child { display: none; } Also Read : Why Crypto Market Is Up Today: Trump’s Tariff Pause Sends Bitcoin to $82K , Crypto Market Reacts Steadily The crypto market remained stable in response to the Fed’s move. Assets like Bitcoin and Ethereum showed minimal volatility as the decision signaled caution rather than concern. By slowing QT, the Fed is effectively keeping more liquidity in the system, which can be favorable for riskier assets such as cryptocurrencies . Although the primary focus remains on the federal funds rate, the Fed’s approach to QT continues to influence broader market sentiment. 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Markets currently expect 2–3 rate cuts in 2025, depending on inflation trends and economic data. What time is the Fed announcement? The Fed typically announces policy decisions at 2:00 p.m. ET after FOMC meetings. What are Fed meeting minutes? Fed minutes are detailed summaries of FOMC discussions, released three weeks after each meeting.