Some Federal Reserve officials thought additional bond buying would be needed to fill the gap when the Operation Twist program expires at the end of the year, minutes of the Fed's October policy meeting showed on Wednesday.
"A number of participants indicated that additional asset
purchases would likely be appropriate next year after the conclusion
of the maturity extension program in order to achieve a substantial
improvement in the labor market," the Fed noted in minutes released
on Wednesday for a Federal Open Market Committee (FOMC) meeting held
from Oct. 23 to 24.
In June, the central bank decided to extend through the end of
the year the Operation Twist, a program of selling short-term
securities to buy longer-term debt to push down long-term interest
rates.
In a bid to bolster the economic recovery, the Fed in September
launched the third round of quantitative easing, an open-ended
program to buy agency mortgage-backed securities at a pace of 40
billion U.S. dollars per month.
The minutes also showed that many participants saw the
uncertainty attending the unresolved U.S. fiscal situation and the
ongoing fiscal and financial strains in the euro area as factors
likely to restrain the pace of economic growth in coming months.
The FOMC members generally expected that pace of the economic
recovery to stay moderate over coming quarters.
The Fed will conduct its last policy meeting of this year on Dec.
11 and 12.
