Federal Funds Rate Targeted at 0 to 1/4 Percent

The Federal Open Market Committee has set a new target range of 0-0.25% for the federal funds rate amid news of a weakening economic forecast.

The rate levels are expected to remain low for the foreseeable future, as the numbers for consumer spending, business investment and industrial production remain weak. Likewise, the Federal Reserve’s monetary policy will continue towards the goal of promoting new and sustainable growth while keeping current price levels in check.

Future goals for the Committee will be to stimulate the economy by enacting open market operations and keeping the Federal Reserve’s balance sheet at a high level. The Fed will be buying more mortgage-backed securities and agency debt in order to bring aid to housing markets.

Also, the Committee is to begin weighing the benefits of purchasing longer-term Treasury securities.

One additional measure to be undertaken by the Federal Reserve is the Term Asset-backed Securities Loan Facility. This measure will make it easier to extend credit to small businesses and families.

Votes in favor of the FOMC monetary policy action: Chairman Ben S. Bernanke, Christine M. Cumming, Elizabeth A. Duke, Richard W. Fisher, Donald L. Kohn, Randall S. Kroszner, Sandra Pianalto, Charles I. Plosser, Gary H. Stern, Kevin M. Warsh.

The Federal Open Market Committee has set a new target range of 0-0.25% for the federal funds rate amid news of a weakening economic forecast.

The rate levels are expected to remain low for the foreseeable future, as the numbers for consumer spending, business investment and industrial production remain weak. Likewise, the Federal Reserve’s monetary policy will continue towards the goal of promoting new and sustainable growth while keeping current price levels in check.

Future goals for the Committee will be to stimulate the economy by enacting open market operations and keeping the Federal Reserve’s balance sheet at a high level. The Fed will be buying more mortgage-backed securities and agency debt in order to bring aid to housing markets.

Also, the Committee is to begin weighing the benefits of purchasing longer-term Treasury securities.

One additional measure to be undertaken by the Federal Reserve is the Term Asset-backed Securities Loan Facility. This measure will make it easier to extend credit to small businesses and families.

Votes in favor of the FOMC monetary policy action: Chairman Ben S. Bernanke, Christine M. Cumming, Elizabeth A. Duke, Richard W. Fisher, Donald L. Kohn, Randall S. Kroszner, Sandra Pianalto, Charles I. Plosser, Gary H. Stern, Kevin M. Warsh.