Fed Leaves Rates Unchanged

As expected, the target for the Fed Funds rate remained unchanged, close to a level of zero. Heading into the announcement, the biggest question for investors was whether the Fed would begin to purchase Treasuries in addition to MBS. According to the statement, the Fed is ready to purchase Treasuries if conditions warrant. The vote was 8 to 1, and the dissenter was in favor of immediate Fed purchases of Treasuries. The statement also reported that the Fed would expand the program to purchase MBS if needed. Overall, the Fed expects to keep rates extremely low for "some time" and will "employ all available tools" to boost the economy.