Halfpercentagepoint hike likely to be first of several
Fed expected to begin to shrink 9 trillion balance sheet
Policy statement due at 2 p.m. EDT 1800 GMT

WASHINGTON, May 4 Reuters The Federal Reserve on Wednesday is expected to raise interest rates by half of a percentage point and announce the start of reductions to its 9 trillion balance sheet as U.S. central bankers intensify efforts to bring down high inflation.

Fed policymakers have widely telegraphed a doublebarreled decision that would lift the Fed39;s shortterm target policy rate to a range between 0.75 and 1, and set in motion a plan to trim its portfolio of Treasuries and mortgagebacked securities MBS by as much 95 billion a month.

The policy statement is due to be released at 2 p.m. EDT 1800 GMT following the end of the Fed39;s latest twoday meeting.

Markets have priced in further rate increases through this year and into next, including at least a couple more halfpercentagepoint hikes, as traders bet the central bank moves much more quickly than it had anticipated it would in March to get borrowing costs up to where they will start actively curbing inflation.

With no fresh Fed economic or policy rate projections due until the central bank39;s June meeting, most clues on how far and how fast it is prepared to go will come from Fed Chair Jerome Powell39;s news conference, which starts at 230 p.m. EDT.

The Fed began its current round of policy tightening in midMarch with a quarterpercentagepoint rate…