Wednesday 9 October 2013

Fed shock decision not to taper QE was 'close call' - minutes

The Federal Reserve's shock decision last month not to reduce its support for the U.S. economy was a "relatively close call" for policymakers, according to minutes of the meeting that also suggested there was still broad support to trim bond-buying this year.

Since last month's meeting, the outlook for scaling back bond purchases has grown cloudier.
The minutes of the Fed's September 17-18 meeting, released on Wednesday, clearly showed top officials were concerned their decision to keep buying $85 billion (53.2 billion pounds) in bonds each month could muddle their messaging with investors who largely expected a reduction.
"For several members, the various considerations made the decision to maintain an unchanged pace of asset purchases at this meeting a relatively close call," the minutes said of the 10 voting FOMC members.
Referring to the broader group of 17 Fed policymakers, the minutes said, "most participants judged that it would likely be appropriate to begin to reduce the pace of the Committee's purchases of longer-term securities this year and to conclude purchases in the middle of 2014."

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