The FOMC has said that it will leave the target Fed Funds Rates between 0.00% to 0.25%. The group also noted that the decision was unanimous and said that the contractions in the economy were actually slowing. It sees some stabilization of household spending and said the economic outlook has improved modestly since the March FOMC meeting as financial market conditions eased. More importantly, the FOMC noted that economic activity is expected to remain weak for a time but says risks to inflation remain subdued and sees a gradual resumption of growth.
The FOMC has also said it will use all tools to promote recovery and price stability, but will carefully monitor the size of the balance sheet. It is reaffirming plans to buy up to $1.25 trillion in agency mortgage-backed securities. It also plans to buy up to $200 billion in agency debt by year end and up to $300 billion in Treasuries by Fall.
The full release from the FOMC can be seen here.
The DJIA was trading up 183.19 points at 8,200.14 before the announcement, and the DJIA is up 174.43 at 8,191.38 at 2:24 PM EST. The 10-Year T-Note was yielding 3.02% before the announcement and that does not appear to have changed.
Jon C. Ogg
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