The Fed signaled it will keep its easing programs in place, but markets were spooked by a tone that sounded slightly less dovish than some traders expected.
Following its two-day meeting, the Fed said in its statement that it would continue with its $85 billion monthly purchases of Treasury and mortgage securities, as expected. But the Fed eliminated some language in its statement, including its concern about a tightening of financial conditions, a reason it cited for maintaining its easing program in September.
The Fed also removed comments about higher mortgage rates, and it did not sound as negative on the economy as some Fed watchers were expecting.
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