FOMC Minutes: Stand Pat With No Change in Outlook

The Federal Open Market Committee decided to hold monetary policy where it was since large-scale asset purchase programs "were nearing completion and neither the economic outlook nor financial conditions had changed appreciably since the December meeting," according to minutes of the Jan. 26-27 meeting, which were released yesterday.

The FOMC affirmed its intention to purchase $1.25 trillion of agency mortgage-backed securities and $175 billion of agency debt by the end of the quarter and "gradually slow the pace of these purchases," according to the minutes.

The minutes noted the FOMC will keep evaluating the purchases as the economic outlook evolves. However, while the ending of the purchases nears, the reference would need to be changed in its statement, but members felt such a move would be "premature."

The FOMC expects a moderate recovery in "the next two years, with economic growth supported by the accommodative stance of monetary policy and by a further waning of the factors that weighed on spending and production over the past two years," the minutes said.

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