Monetary policy | GlobalPost

Fed mulls exit strategy update amid timing debate

Agence France-PresseMay 22, 2013 17:47

The Federal Reserve has begun reviewing its strategy to exit stimulus measures, according to the minutes of the last FOMC policy meeting released Wednesday. But officials at the Federal Open Market Committee meeting on April 30-May 1 remained divided over just when to begin tapering down the exceptionally accommodative policy used to support the US economy's recovery, the minutes showed. With indicators pointing to moderate growth, the FOMC began an update of the exit strategy outlined in the panel's June 2011 meeting.

Fed minutes showed some officials willing to consider trimming bond purchases as early as June

The Canadian PressMay 22, 2013 15:18

WASHINGTON - Several Federal Reserve policymakers this month favoured slowing the Fed's efforts to maintain record-low long-term interest rates as early as June — if the economy showed strong and sustained growth. But those officials appeared at odds over what evidence would demonstrate such gains. Minutes of the Fed's April 30-May 1 meeting released Wednesday show "a number" of members expressed a willingness to scale back the $85 billion a month in Treasury and mortgage bonds the Fed has been purchasing, perhaps as soon as next month, if the economy accelerates.

Bernanke warns against premature policy tightening

Agence France-PresseMay 22, 2013 11:15

US Federal Reserve Chairman Ben Bernanke warned Wednesday that tightening monetary policy now could stall the US recovery, but added that another few months of positive data could lead the Fed to start reining in stimulus. Defending the Fed's continuing stimulus, Bernanke told Congress that US economic growth continues at a moderate pace with no threat of inflation or, as some analysts have worried recently, deflation.

Bernanke warns that premature ending of Fed's stimulus efforts would carry substantial risks

The Canadian PressMay 22, 2013 11:00

WASHINGTON - Chairman Ben Bernanke told Congress Wednesday that the U.S. job market remains weak and that it is too soon for the Federal Reserve to slow its extraordinary stimulus programs. Reducing the Fed's efforts to keep borrowing rates low would "carry a substantial risk of slowing or ending the economic recovery," Bernanke said in testimony to the Joint Economic Committee, a panel that includes members of the House and Senate.

Highlights: Bernanke's prepared testimony to congressional panel

Thomson ReutersMay 22, 2013 10:46

WASHINGTON (Reuters) - Below are highlights of Federal Reserve Chairman Ben Bernanke's prepared testimony on the U.S. economy to the congressional Joint Economic Committee on Wednesday. At its most recent meeting, the Committee made clear that it is prepared to increase or reduce the pace of its asset purchases to ensure that the stance of monetary policy remains appropriate as the outlook for the labor market or inflation changes.

Bernanke says more progress needed before stimulus pullback

Thomson ReutersMay 22, 2013 09:46

By Pedro da Costa and Alister Bull WASHINGTON (Reuters) - The Federal Reserve's monetary stimulus is helping the economy recover but the central bank needs to see further signs of traction before taking its foot off the gas, Fed Chairman Ben Bernanke said on Wednesday. A decision to scale back the $85 billion in bonds the Fed is buying each month could come at one of the central bank's "next few meetings" if the economy looked set to maintain momentum, Bernanke told Congress.

TSX up slightly, Wall Street falls amid talk of possible end to Fed stimulus

The Canadian PressMay 22, 2013 09:17

TORONTO - North American markets were mixed Wednesday after U.S. Federal Reserve chairman Ben Bernanke said the central bank has considered ending its extraordinary stimulus program, but added that it is too soon to do it now. Indexes in Toronto and the U.S. initially surged on news that the Fed had no immediate plans to turn the tap off on its $85-billion-a-month bond buyback program. But by the end of the day, the S On Wall Street, the Dow Jones industrials index was down 80.41 points at 15,307.17. The S

Loonie falls nearly a penny amid signs that U.S. Fed has no plans to end stimulus

The Canadian PressMay 22, 2013 09:16

TORONTO - The Canadian dollar dropped nearly a penny Wednesday as the head of the U.S. central bank said that prematurely ending the Fed's $85-billion-a month monetary stimulus program could harm the world's largest economy. The loonie was down of 0.98 of a cent at 96.41 cents US. Bernanke told Congress that there was a "substantial risk" in scaling back or stopping the bond buyback program, but when pressed, added that action could be taken as early as U.S. Labor Day.

BOK-Fed policy shift

Yonhap News AgencyMay 22, 2013 02:45

(ATT: UPDATES with more info in last 2 paras) SEOUL, May 22 (Yonhap) -- South Korea's top central banker said Wednesday that the potential end of the U.S. Federal Reserve's massive monetary easing drive could spark risks from a rise in bond yields, raising the need to brace for impacts of such a policy shift. Speculation is growing that the Fed may slow the pace of its bond purchases this year, which probably will jack up bond yields, causing losses for bond holders such as banks and other financial institutions.

Bernanke's congressional testimony to be studied for any hints of shift on Fed bond purchases

The Canadian PressMay 22, 2013 00:47

WASHINGTON - When Ben Bernanke testifies about the U.S. economy Wednesday, the Federal Reserve chairman's words will be examined for any clues that the Fed might soon taper — or increase — its support for the economy. The Fed is pursuing an aggressive program of bond purchases to try to keep long-term interest rates down and encourage borrowing and spending. The Fed has said it plans to continue its $85 billion-a-month in Treasury and mortgage bond purchases until the job market improves substantially. The timing of any policy shift remains hazy.