U.S. Fed policymakers posit slower quantitative easing

02/21/2013 | Bloomberg

The U.S. Federal Reserve may be developing cold feet over its quantitative-easing policy, as indicated in newly released minutes of its policymaking panel's late-January meeting. Several participants said the Fed "should be prepared to vary the pace of asset purchases, either in response to changes in the economic outlook or as its evaluation of the efficacy and costs of such purchases evolved," the minutes said. That suggests a "tapering" of the purchases may eventually come, which would allow the Fed "to calibrate how the market reacts ... without having to go cold turkey," said Michael Hanson, senior U.S. economist at Bank of America and a former Fed economist.

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