Federal Reserve Vows To Continue Policy

Washington, DC, Dec. 15, 2010 -- The Federal Reserve said that even though there are signs of economic improvement, it will continue to pump money into the financial system so long as unemployment remains high.

The Federal Open Market Committee said that growth is “insufficient to bring down unemployment” and inflation has “continued to trend lower.” 

U.S. central bankers affirmed a plan to buy $600 billion of bonds through June and renewed their pledge for an “extended period” of low interest rates.

The FOMC statement said “household spending is increasing at a moderate pace, but remains constrained by high unemployment, modest income growth, lower housing wealth, and tight credit.”

Kansas City Fed President Thomas Hoenig, the longest- serving policy maker, voted against the FOMC decision for the eighth straight time, reiterating his view that the “continued high level of monetary accommodation” may eventually “destabilize the economy.” He tied former Governor Henry Wallich’s record in 1980 for most dissents in one year.