United States: Fed maintains current stance as expected
December 13, 2011
At its policy meeting on 13 December, the Federal Open Market Committee (FOMC) left the federal funds rate within the historically-low range of 0% to 0.25% established in December 2008. The Committee also left unchanged its average maturity extension programme, commonly referred to as Operation Twist, and announced it would continue reinvesting the proceeds from its maturing debt. All these decisions were expected by the market. The Fed highlighted ?that the economy has been expanding moderately, notwithstanding some apparent slowing in global growth?. Moreover, the FOMC expects growth to continue at ?moderate pace? in the quarters ahead. That said, monetary authorities warned about downside risks stemming from tensions in global financial markets. On the inflation side, the FOMC ?anticipates that inflation will settle, over coming quarters, at levels at or below those consistent with the Committee's dual mandate.?