25-26 January FOMC review: giving the all clear for March hike

With its two criteria having been met (price stability and full employment), the Fed indicated that the start of the rate normalisation cycle is soon. The Fed probably avoided referring to the next meeting scheduled in March to give them optionality should external events have a detrimental impact on growth. 

The Fed recognised that the recent rise in Covid-19 cases has weighed on short-term growth prospects, but would not be long lasting. The asset purchase programme will end in early March. 

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