The Traderszone Network

Published in TZ Latest News 6 May, 2015 by The TZ Newswire Staff

Wary of bond ‘cliff,’ Fed plans cautious cuts to portfolio

NEW YORK/SAN FRANCISCO (Reuters) – The Federal Reserve is sketching out plans to prevent an abrupt contraction in its massive balance sheet next year, when some $500 billion in bonds expire and risk disrupting markets and the U.S. economic recovery. Though it ended a stimulative asset-purchase program last October, the Fed is still buying mortgage and Treasury bonds to replenish its $4.5-trillion portfolio as holdings mature.