Citing signs that the U.S. economy is beginning to show improvement but remains strained, the ""Federal Reserve Board"":http://www.federalreserve.gov decided this week to leave its benchmark federal funds rate at a target range of 0 to 0.25 percent - exactly where it's been sitting since December of last year. The Fed said that in light of current economic conditions, it will keep interest rates near-zero ""for an extended period.""
The central bank also voted to maintain its previously announced financial rescue policies, which are intended to provide support to mortgage lending and housing markets and to improve overall conditions in private credit markets. The Federal Reserve has committed to buying $300 billion of Treasury securities by autumn, as well as $200 billion of GSE-related debt and $1.25 trillion of agency mortgage-backed securities (MBS) by the end of the year.
In its ""policy statement"":http://www.federalreserve.gov/newsevents/press/monetary/20090624a.htm, the Fed said it will continue to evaluate the timing and overall amounts of its purchases of securities in light of the evolving economic outlook and financial market conditions. This week, the Federal Reserve's New York bank bought $22.3 billion in MBS, bringing total purchases for the year to an estimated $600 billion.
The gross amount of the ""Fed's MBS buys"":http://www.newyorkfed.org/markets/mbs/ this week came to $23.8 billion. It bought $11.4 billion in mortgage securities from Fannie Mae, $8.8 billion from Freddie Mac, and $3.6 billion from Ginnie Mae.