US stocks close lower as concerns mount over Fed bond-buying
City Index January 4, 2013 2:15 PM
<p>The main US stock indices have retreated as Fed members are concerned about the bank’s bond-buying programme.</p>
The US's major stock indices closed lower in trading last night (January 3rd) as it emerged that a number of senior Federal Reserve (Fed) officials have voiced their concerns over the institution's bond-buying programme.
Minutes from last month's Federal Open Market Committee meeting showed that several of the 12 members made the call for the Fed to stop or slow down its asset purchases ahead of the end of this year.
The central bank is spending up to $85 billion (£53 billion) a month on buying bonds – action the apprehensive Fed members are worried could lead to higher inflation.
This open-ended asset purchasing run came into force in December 2012 and replaced an earlier initiative called Operation Twist. One of the aims of this latest programme is to keep a lid on the long-term cost of borrowing in the US.
At close of play on Wall Street last night, the Dow Jones retreated by 0.1 per cent to an index value of 13391.3 points and the Nasdaq slipped by 0.3 per cent to 3100.5 points.
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