Extending the Easing Cycle

- "The FOMC this week signaled a reenergized commitment to low interest rates and more supportive financial conditions. Officials have downgraded forecasts of nearterm economic growth, while reinvestment of proceeds from redeemed securities will buoy expectations of more substantive easing ahead."
- "The combination of the Fed's message, downward revisions to recovery's recent path and lingering financial headwinds suggests that policy will remain focused on accommodation efforts through all of 2011. Until recovery has demonstrated greater self-sustaining momentum and a solid stretch of accommodating financial conditions is reestablished, monetary policy will need to err on the side of ease."
- "The reinvestment plan likely will be enhanced by more active balance sheet expansion or perhaps new efforts to unblock credit. In particular, borrowing conditions for creditworthy small businesses remain strained and could be a targeted focus of policy ahead."
Citigroup Comments on Credit 20100813

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