The Federal Reserve gave no indication that it intends to reduce bond buying, for now at least. In a two-day gathering, the Central Bank said while the United States is still affected by federal budget-tightening, its economy continues to recover. To support the recovery, The Fed announced that it would continue its monthly buys of USD 85 billion worth of mortgage and Treasury securities.
In its post-meeting statements, the central bank said the pace of growth was merely "modest." This was a downgrade from the past year when The Fed consistently called the growth "moderate." It also hinted a potential housing recovery as indicated by the rise in mortgage rates. It also agreed with James Bullard, the President of St. Louis Federal Reserve Bank, on the dangers of inflation reaching very low levels. The Federal Reserve noted, "The committee recognizes that inflation persistently below its 2 percent objective could pose risks to economic performance, but it anticipates that inflation will move back toward its objective over the medium term."
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