Fed Says Too Early to End Monetary Stimulus

Fed Says Too Early to End Monetary Stimulus

http://www.bloomberg.com/apps/news?pid=20601103&sid=a7PUzPYyvn7M

The Federal Reserve has signaled that the current recovery in the US economy is inadequate to justify a withdrawal of the various monetary stimulus measures introduced by the central bank in recent months. The US economy has started picking up and the planned asset purchases by the central bank are expected to result in improved resource utilization levels, according to the Fed’s Open Market Committee. The Federal Reserve has extended the closure date of its $1.25 trillion program for purchase of mortgage securities from December this year to March 2010. The Fed is also likely to delay a raise in the interest rates. The US economy is witnessing record unemployment with businesses continuing to cut back on fixed investments. The economic weakness is likely to keep the cost pressures and the inflation subdued for the time being, policy makers have said.