To nobody’s surprise, the Federal Open Market Committee will continue its monthly bond-buying program due to a weak economy.
With the labor market reporting its lowest gains in six months, the FOMC statement said the economy has maintained the same “moderate” pace reported in September. As a result, the $85 billion-per-month in asset purchases will be extended for the foreseeable future.
The weakening job market saw private employers adding just 130,000 jobs in October, shy of the forecast and down from the 145,000 in September. Over the past three months, an average of 142,000 jobs were added, which is about 78,000 fewer than the average at the beginning of the year.
Current Fed Chair Ben Bernanke and Vice Chair Janet Yellen — Bernanke’s assumed successor — say current unemployment rates still pose a serious threat to economic growth and are among the most pressing issues at the moment.
Because of those lower-than-expected numbers and the 16-day government shutdown earlier this month (not mentioned in the statement), the Fed will be forced to wait to slow its tapering until 2014.
More information could be available when meeting minutes are released on Nov. 20.
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