Fed says will keep holdings of securities at current level by reinvesting principal payments from agency debt, MBS in longer-term treasuries
- Will continue to roll over holdings of treasury securities as they mature
- To keep rates exceptionally low for an extended period of time, keeps fed funds rate at zero to 0.25% range
- Pace of recovery has slowed in recent months
- Pace of recovery is likely to be more modest in near term than had been anticipated
- Will provide technical guidance on operations later this afternoon
- Measures of inflation have trended lower in recent quarters
- Inflation likely to be subdued for some time
- Household spending increasing gradually but constrained by high unemployment, housing, tight credit
- Vote on policy was 9-1 with Hoenig dissenting
- Fed will monitor outlook and employ policy tools as necessary to promote recovery