The median estimates put the U.S. GDP growth 7% this year, with the unemployment rate dropping to 4.5% and falling further in the next two years. Core inflation is expected to come in at 3%, before declining to 2.1% in 2022 /Colby Smith, FT, US economy, AUGUST 4 2021/.

Against this background, the case for the FED to withdraw of monetary policy support is clear-cut. First rate increases, however, might only come in 2023.

Some Fed governors see the point, urging the central bank “to go early and fast”, admitting that there is “some policy space to do it by the end of the year”.

Nevertheless, the U.S. might repeat Japan’s monetary policy mistakes made during the lost two decades between 1990 and 2010 and they might end up with historically huge public debts, unsustainable inflation rates /negative in Japan, positive in the U.S./ and sluggish growth figures.

Even giants can start with baby-steps to arrive sharply on time.

Governor Matolcsy, MNB, the Central Bank of Hungary

Re “Fed officials sketch out conditions for scaling back monetary support