|Traders work on the floor of the New York Stock Exchange in New York, Nov. 3, 2010. Wall Street swung to gain on Wednesday after the U.S. Federal Reserve announced a plan to buy 600 billion U.S. dollars more in Treasury bonds. (Xinhua/Shen Hong)
WASHINGTON, Nov. 3 (Xinhua) -- U.S. Federal Reserve announced Wednesday it will buy 600 billion dollars more in Treasury bonds, in a move known as the "Quantitative Easing" (QE2) monetary policy to boost the sluggish economic growth.
"The pace of recovery in output and employment continues to be slow," the Fed said in a statement after the policymaking panel meeting.
Federal Open Market Committee (FOMC), the interest rate policy making body of the central bank said that it will "purchase a further 600 billion dollars of longer-term Treasury securities by the end of the second quarter of 2011, a pace of about 75 billion dollars per month."
The Fed also decided to maintain the target range for the federal funds rate at historic low level of zero to 0.25 percent to stimulate the economic recovery.
The central bank cut the interest rate to the current level in December 2008 to tackle the worst recession after the Great Depression in the 1930s. And it has already bought about 1.7 trillion dollars in U.S. government debt and mortgage-linked bonds.
With the U.S. economy growth at only a 2 percent annual pace in the third quarter of this year and the jobless rate seemingly stuck around 9.6 percent, the Fed has come under pressure to do more to stimulate business activity.
Bernanke and his supporters argue that the Fed is failing in both fronts of its dual mandate: sustainable levels of unemployment and inflation.