Federal Reserve policy makers last month said they were in no rush to sell $1.1 trillion of mortgage-backed securities, with a majority preferring to wait until after the central bank starts raising interest rates.
“Most participants favored deferring asset sales for some time,” while others wanted to announce a schedule or start sales soon, the Fed said in minutes of its April 27-28 meeting in Washington, released today. Officials lowered their projections for inflation, excluding food and fuel, while keeping forecasts little changed for economic growth and unemployment in 2011 and 2012.
The minutes show that Chairman Ben S. Bernanke and his colleagues are still trying to reach a consensus over when and how fast to shrink the Fed’s balance sheet as the economy recovers. The Fed aimed to lower home-loan costs and boost growth by buying mortgage securities through last March after lowering the benchmark interest rate almost to zero in December 2008.
Full story: Fed in No Rush to Sell Mortgage Assets, Minutes Show (Update1) – Bloomberg.com