With investment in nonresidential properties still weak and persistent depression in the housing market, the Federal Open Market Committee once again kept the federal funds rate at next to nothing. The central bank also reiterated its plans to reinvest maturing securities into longer-term Treasury securities through the end of the current quarter. As it has for the past several months, the Fed said the economic recovery is progressing moderately and conditions in the labor market are improving gradually. The FOMC continues to expect a “gradual return to higher levels of resource utilization in a context of price stability.” But members expects this to be transitory, and plan to closely monitor rising energy and commodity prices to gauge their effects on inflation. Committee members voted unanimously in favor of the monetary policy decision. Federal Reserve Chairman Ben Bernanke is set to hold a first-of-its-kind press conference later Wednesday. The federal funds rate has been 0% to 0.25% since December 2008. And the FOMC reiterated its belief that “economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels for the federal funds rate for an extended period.” In November, the Fed began its plan to purchase up to $600 billion of longer-term Treasury securities by the end of the second quarter “to promote a stronger pace of economic recovery and help ensure that inflation, over time, is at levels consistent with its mandate.” In Wednesday announcement, the FOMC did leave the door open to ending the bond-buying program early if it determines that’s the best way to “foster maximum employment and price stability.” Write to Jason Philyaw.

Most Popular Articles

FHA loan limits increasing for almost all of U.S. in 2020

Thanks to increases in home prices in 2019, the Federal Housing Administration loan limit will increase for nearly all of the country in 2020.

Dec 05, 2019 By

Latest Articles

HousingWire is growing. Come join us

2019 has been a year of tremendous audience and product growth for HousingWire and we couldn’t be prouder. But we’re not ready to rest on our laurels. Far from it. In fact, 2020 promises to be an even bigger year for HousingWire.

Dec 06, 2019 By
3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please