Fed edges toward shutting down mortgage-bond purchases

09/3/2009 | Bloomberg

The Federal Reserve is looking for a way to wind down its purchases of mortgage-backed securities without indirectly forcing up interest rates on residential mortgages, according to minutes from the Federal Open Market Committee. The discussion shows officials are worried about bringing additional volatility into the residential market when the economic recovery is already shaky in the U.S. Several committee members think "a tapering of agency debt and [mortgage-backed securities] purchases could be helpful," according to the minutes.

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