Tags: US | Fed | Minutes

Fed Keeps Eyes Out for Speculative Bubbles

Tuesday, 06 Apr 2010 02:05 PM

Federal Reserve officials at their March meeting stressed the importance of making sure record-low interest rates don't feed new speculative bubbles in stocks or other assets.

Some officials said the Fed's pledge to keep rates low for an "extended period" doesn't mean a fix period of time. Rather, it depends on the strength of the economy, according to minutes of the meeting. Analysts have taken the pledge to mean rates need to stay at record lows for roughly six months to help underpin the recovery.

Those Fed officials argued that the pledge won't stop the Fed from boosting rates if the economy showed signs of picking up substantially or if inflation took off. On the other hand, the pledge "could last for some time" if the economy took a turn for the worse.

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Federal Reserve officials at their March meeting stressed the importance of making sure record-low interest rates don't feed new speculative bubbles in stocks or other assets.Some officials said the Fed's pledge to keep rates low for an extended period doesn't mean a fix...
US,Fed,Minutes
133
2010-05-06
Tuesday, 06 Apr 2010 02:05 PM
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