http://www.bbc.com/news/business-29823798
The Fed Chief, Janet Yellen, has announced that the US Fed will end the Quantitative Easing (QE) program that was started in 2008.
The program has slowly been cutting back on the program recently but the recent success of the US economy has led to this decision. Mrs. Yellen and the Fed have assured the public that the interest rates will remain low for a "considerable time". The job market is strengthening but is not strong enough to have the interest rates raised. The Fed has chosen to guide the economy through stability but wants to know how the inflation prices will react.
Without quantitative easing, I'm interested to see how the US economy responds. I'm sure that the US economy will bounce back and surpass the levels from 2008. However, the world economy needs to start heading into the right direction as well.
This is interesting because in 2013, the Fed stated that it would consider raising interest rates once unemployment neared 6.5%, or when the inflation rate reached 2.5%. As the unemployment rate approached the 6.5% level more quickly than anticipated, the Fed abandoned this original plan. It appears that the Fed will no longer consider the unemployment rate in isolation as a measure for when to raise interest rates and will instead consider a broader range of alternative information.
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