Federal Reserve Announces Plan to End Bond Buying Program in October
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iStockphoto/Thinkstock(WASHINGTON) — The Federal Reserve plans to end its bond buying program in October, after seeing signs of a healing economy.
The program was put into effect in late 2008 to help support the mortgage market, and promote spending, lending and hiring. The program had been expected to end, as recent months have seen economic figures — including unemployment and available jobs — slowly improving, but on Wednesday, the Federal Reserve said that the plan is to end the program in October, provided the economic trajectory remains the same.
The Fed had already cut bond purchases in $10 billion increments, from a high of $85 billion to about $35 billion per month, the Wall Street Journal reported.
Since the program was enacted, the jobless rate has fallen from 7.8 percent to June’s 6.1 percent.
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