The Federal Reserve on June 24 said that there is easing of recession but that the economy likely will remain weak and keep a lid on inflation. The Fed Chairman Ben Bernanke and his colleagues said that despite easing of the recession, the economy remains frail enough to keep inflation at bay.
The Fed held a key bank lending rate at a record low of between zero and 0.25 percent, and pledged again to keep it there for "an extended period". The Fed said that the inflation will remain "subdued for some time."
The Federal Reserve defuses the Wall Street''s concerns that the aggressive actions by Fed to revive the economy will spur inflation at later stage.
Moreover, Fed also decided to stay the course on existing programs intended to drive down the rates on mortgages and other consumer debt.
Instead, the central bank again kept the option open to making changes if economic conditions warrant.
The Fed in March launched a $1.2 trillion effort to lower the interest rates to revive the lending. Meanwhile, it said it would spend up to $300 billion to buy long-term government bonds over six months and boost its purchases of mortgage securities.
So far, the Fed has bought Treasury bonds of about $177.5 billion. However, the Fed is on track to purchase securities up to $1.25 trillion issued by Fannie Mae and Freddie Mac by the end of this year or early next year.
The Fed held a key bank lending rate at a record low of between zero and 0.25 percent, and pledged again to keep it there for "an extended period". The Fed said that the inflation will remain "subdued for some time."
The Federal Reserve defuses the Wall Street''s concerns that the aggressive actions by Fed to revive the economy will spur inflation at later stage.
Moreover, Fed also decided to stay the course on existing programs intended to drive down the rates on mortgages and other consumer debt.
Instead, the central bank again kept the option open to making changes if economic conditions warrant.
The Fed in March launched a $1.2 trillion effort to lower the interest rates to revive the lending. Meanwhile, it said it would spend up to $300 billion to buy long-term government bonds over six months and boost its purchases of mortgage securities.
So far, the Fed has bought Treasury bonds of about $177.5 billion. However, the Fed is on track to purchase securities up to $1.25 trillion issued by Fannie Mae and Freddie Mac by the end of this year or early next year.
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