Bloomberg’s most recent update on economists’ expectations for the US Federal Reserve to begin tapering its asset purchases found that 45% of those surveyed believe the Fed balance sheet will begin to contract in Q4 of 2021. This is important because expectations are moving forward, as the previous month survey (March) had only 27% of respondents foreseeing the Fed tapering beginning in Q4 2021. The main difference between the April and March reports was a shift from Q1 2022 to Q4 2021. The Fed is not expected to alter policy in this week’s FOMC policy statement release and will likely maintain highly accommodative monetary conditions. But, the shift in expectations may turn out to be critical for capital markets. Benign Fed policy has been one of the main factors supporting asset prices over decades and especially in recent years. The shift in expectations may become a headwind for risk assets in the months ahead.