U.s. Economy, Central Bank | featured news

The central bank affirmed that it would keep up its existing efforts to stimulate the economy, even though it expected a return to moderate growth.

The Federal Reserve has left little doubt about its plans, but inside the central bank, debate is moving from whether the Fed should do more to stimulate the economy to when it should start doing less.

The central bank said Wednesday that it would maintain short-term interest rates near zero, even after it stops buying bonds, for as long as the unemployment rate stayed above 6.5 percent.

The Federal Reserve, hoping to give another shot in the arm to the pallid recovery, announced it would launch a new round of a controversial bond-buying stimulus program. The central bank also further extended its pledge to keep short-term interest rates near zero, now through the middle of 2015.

Federal Reserve Chairman Ben S. Bernanke gave no indication Tuesday that the central bank was about to launch new economic stimulus, even as the Fed chief painted a worrisome picture of an economy losing momentum on a wide scale.

European Central Bank Governing Council member Ewald Nowotny does not expect the U.S. economy to enter a double-dip recession and is more concerned about fast-growing developing markets, he told a newspaper.