Barclays economists said the Fed's surprise advance of the expected rate hike means the Fed is likely to formally announce reduced asset purchases at its September meeting and scale back its bond purchases by $120 billion a month starting in November.
Michael Gapen, chief US economist at Barclays, and colleague Jonathan Millar wrote in the report that "both parts of the FOMC statement are seen as hawkish, including concerns about the reduction in the risk of the epidemic and the failure to mention a slowdown in job growth."
"the Fed seems to be getting closer to minus, but there is no clear answer as to how much substantial progress the economy has made towards the Fed's goals and how to view the changes in the bitmap," they wrote.
However, given the change in the wording of the statement and the change in the bitmap, Barclays moved its forecast for the Fed to announce a reduction from November to September and the time when it actually began to scale back its bond purchases from January to November.