Fed Holds Rates, Sees Economy 'Leveling Out'

The Federal Reserve has slowed its recovery-minded plan to purchase Treasury securities but said that "economic activity is leveling out," the Wall Street Journal reports. The Fed’s policy committee hopes to complete its $300 billion purchase of Treasury securities by October—originally slated for September—and also plans to keep interest rates near zero, saying it “continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds rate.”

The cautious response belies an increasingly rosy economic picture: Activity is falling much less than was anticipated, and some economists predict GDP growth, and others say recent data show the recession ended in June. Still, the Fed predicts the economy is “likely to remain weak for some time.” (More Federal Reserve stories.)