A second-quarter economic rebound did nothing to change the outlook of the Federal Reserve, which stayed the course Wednesday with ultra-easy monetary policy.
While the U.S. central bank voted to cut its monthly bond-buying program another $10 billion, it left its short-term interest rate target near zero and expressed only tepid encouragement about growth. The Fed also voted to continue to reinvest proceeds from maturing bonds as its balance sheet swells near the $4.5 trillion mark.
Market reaction was modestly positive to the statement with stocks shaving losses. There was some thought that the meeting could feature dissent, particularly from Dallas Fed President Richard Fisher, who penned an op-ed piece in the Wall Street Journal earlier this week indicating his dissatisfaction with ultra-easy monetary policy from the U.S. central bank. After the Fed released its meeting statement, several analysts noted “tension” within the language.