Options Wonderland

[3xBuBu]

The Federal Reserve said it would buy $40 billion each month of agency mortgage-backed securities on an open-ended basis, and said it could extend those purchases and buy additional assets if the jobs market doesn't improve.


The Fed also said it would continue a program known as Operation Twist, under which the central bank has been selling short-term bonds and using the proceeds to buy longer-term bonds.


Taken together, the Fed will be purchasing $85 billion of longer-term securities per month through the end of the year. Fed officials also said they expected to keep short-term interest rates near zero until at least mid-2015, beyond their previous estimate of late 2014.


Live analysis of the Fed decision and Bernanke's 2:15 p.m. ET press conference: http://blogs.wsj.com/economics/2012/09/13/live-blog-fed-decision-and-bernanke-press-conference-2/?mod=djemalertMARKET