WASHINGTON: The Federal Reserve has said that it plans to keep short-term interest rates low for a ‘considerable’ time after it ends a bond purchase program aimed at stimulating the economy. But the central bank also signalled that it is increasingly focused on normalising monetary policy as the recovery strengthens.
Winding up a two-day meeting, the Federal Open Market Committee said the economy is growing at a ‘moderate’ pace, a slightly more positive outlook than its last policy statement in July. At the same time, the panel noted that weakness in the job market shows “there remains significant underutilization of labour resources.”
The Fed continued to ‘taper’ its monthly purchase of Treasury and mortgage bonds, cutting them by $10 billion, from $25 billion to $15 billion, for a seventh consecutive month. The program, adopted during the financial crisis to help keep interest rates low and support economic growth, is scheduled to end in October.
