Fed’s Bond-Buying Program Maintains Pace with 11-1 Vote


If the Fed is going to keep interest rates at almost 0% and also keep buying bonds at an $85 Billion a month clip until unemployment reaches 6.5% you can look forward to a long stretch with no change in the fed’s policy. For a more detailed look at this subject please read the article below.

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Analysts holding out for a sign that the Federal Reserve may soon taper its asset purchasing program will have to continue waiting: The Fed released on Wednesday the latest Federal Open Market Committee (FOMC) statement, revealing a generally cautious attitude among members as the economy struggles against headwinds.

In its statement, the FOMC says information received since September “generally suggests that economic activity has continued to expand at a moderate pace”—a more uncertain statement than the one expressed in September.

In the labor markets, the committee noted that “conditions have shown some further improvement,” though the unemployment rate is still elevated.

On the subject of housing, the FOMC noted growth has slowed in recent months; however, unlike the September statement, October’s release does not cite rising mortgage rates as a concern. With Washington’s troubles on the backburner for now, it remains to be seen what kind of trend interest rates will take on.

Despite continued improvements and greater economic stability, the committee said it will wait for more evidence of sustainable progress before adjusting the pace of its $85 billion-per-month asset purchases, an initiative first undertaken last fall to keep interest rates down and maintain an accommodative financial environment.

However, the FOMC left open the possibility of a taper in the future, asserting that “[a]sset purchases are not on a preset course” and saying future decisions about their pace will be based on the committee’s economic outlook.

To read the complete article – please use the link below.

Fed’s Bond-Buying Program

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