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Fed Widely Expected to Reduce Bond Buying

The U.S. Federal Reserve is expected to begin its long retreat from ultra-easy monetary policy on Wednesday by announcing a small reduction in its bond buying, while stressing that interest rates will remain near zero for a long time to come.

Most economists expect the Fed to scale back its monthly purchases by a modest $10 billion, taking them to $75 billion and signaling the beginning of the end to an unprecedented episode of monetary expansion that has been felt worldwide.

The baby step would begin to provide a bookend of sorts to the central bank’s response to the global financial crisis that reached fever pitch five years ago this week with the collapse of investment bank Lehman Brothers.

Reuters [1]

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