According to the minutes released from the last Federal Reserve’s meeting , the Fed are not showing any signs of ending the bond-buying program as they need more signs of a stronger economy and an improved job market before proceeding with the cut back in the monthly $85 billion stimulus program .
However, the minutes released also showed the policy makers are still discussing and contemplating whether to end the bond-buying program by the end of 2013.
The minutes stated “many members indicated that further improvement in the outlook for the labor market would be required before it would be appropriate to slow the pace of asset purchases.”
Federal Reserve Chairman Ben S. Bernanke continued by highlighting the labor market is weaker than expected as the current unemployment rate is at 7.6%. The Fed Chief also highlighted the US dollar dropped 0.7% against the euro.
The Fed’s purchase of its monthly $85 billion in mortgage bonds and Treasuries , have kept the interest rate low, persuading people to purchase more properties to boost the economic growth .
Stocks rose as minutes from the Federal Reserve meeting were released, as the Standard & Poor’s 500 Index advanced 0.8 % to 1,661.40.
“It may well be sometime after we hit 6.5 percent before rates reach any significant level, so again, the overall message is accommodation. There is some prospective, gradual and possible change in the mix of instruments, but that shouldn’t be confused with the overall thrust of policy which is highly accommodative,” Bernanke stated in the minutes.
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