Fed tweaks policy

As expected, no big action was taken, but the Federal Open Market Committee acknowledged that the pace of the recovery had slowed in recent months, and was "likely to be more modest in the near term than had been anticipated." As for the tweak, the Fed said it would use the proceeds from its mortgage-bond portfolio to buy long-term Treasury securities. From the NYT:

By buying new government debt, the Fed is taking an unmistakable step to maintain the large amount of money that it pumped into the economy, starting in 2007, to prop up the financial and housing markets.

The Fed left unchanged its benchmark short-term interest rate at zero to 0.25 percent, the level it has been at since December 2008.