Federal Reserve launches QE3

CNNMoney

The Federal Reserve announced plans to unleash more stimulus Thursday, in its third attempt at a controversial program to rev up the U.S. economy.

The policy, known as quantitative easing and often abbreviated as QE3, entails buying $40 billion in mortgage-backed securities each month. The end date remains up in the air, as the Fed will re-evaluate the strength of the economy in coming months.

The Fed is wasting no time. The purchases begin Friday and are expected to add up to only $23 billion for the remainder of September.

The bond-buying policy “should put downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative,” the Fed’s official statement said.

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