The Fed will likely curtail bond-buying soon in response to inflation, and investors increasingly expect benchmark interest rates to rise as early as mid next year.

In fact, Fed Vice Chair Richard Clarida believes the conditions required to begin tapering Fed bond-buying have "all but been met."

Fed bond-buying program might begin tapering in November and end next year, with rate hikes likely to start thereafter.

As the economy improves, the FOMC looks at winding down its Covid-related support—and eventually raising interest rates.

The Federal Reserve chair said the U.S. central bank will wait until the economy has "all but fully recovered" to pull back the monetary support it rolled out in response to Covid-19.

Banks' preparations for the transition are coming under intense scrutiny from the Federal Reserve.

Most services have been restored, but Fed systems that process tens of millions of transactions each day were down for about four hours yesterday.

"The pace of the recovery in economic activity and employment has moderated in recent months, with weakness concentrated in the sectors most adversely affected by the pandemic," the FOMC said.