Stimulus

Fed Buying $600B in Treasury Bonds

The Federal Reserve has announced another round of bond-buying in an attempt to stimulate the flagging economic recovery. By buying $600 billion in Treasury bonds, the Fed hopes to further lower the cost of borrowing for consumers and businesses. Some economists and Fed officials worry that the bond buying will spur inflation when the economic recovery finally accelerates. Emerging economies are also unhappy with the move, as it prompts investors to move toward them in search of higher returns, driving up the value of their currency relative to the dollar and thus decreasing their export competitiveness.