WASHINGTON (11/21/13)--Members of the Federal Reserve's policymaking body, the Federal Open Market Committee, said they would consider slowing the pace the Fed's bond-buying program "in the next few meetings," according to the FOMC minutes released Wednesday afternoon.
In their discussion of monetary policy at the Oct. 29-30 meeting, the committee noted that the economy had changed little since the September meeting, and all members but one judged that it would be wait for more evidence that the economy is improving before adjusting slowing the pace of its $85-billion-a-month program of buying back Treasuries and mortgage-backed securities, a policy known as quantitative easing, or QE3.
"They generally expected that the data would prove consistent with the Committee's outlook for ongoing improvement in labor market conditions and would thus warrant trimming the pace of purchases in coming months," the minutes said. "However, participants also considered scenarios under which it might, at some stage, be appropriate to begin to wind down the program before an unambiguous further improvement in the outlook was apparent."
In the view of one committee member the improvement in the economy indicated that the continued easing of monetary policy at the current pace was no longer necessary. Two other members commented that it would be important to continue laying the groundwork for a reduction in purchases through public statements and speeches.
Committee members generally expressed reservations about the possibility of introducing a rule that would adjust the pace of asset purchases automatically based on a single variable such as the unemployment rate or payroll employment, the minutes said.
The committee also considered whether to comment whether the effects of the temporary government shutdown had made economic conditions more difficult to assess, but determined that such comments might overemphasize the role of the shutdown in the committee's policy deliberations.