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Fed opts to extend Twist program by $267 billion

06/20 12:32 PM

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WASHINGTON (MarketWatch) -- The Federal Reserve on Wednesday said it is extending its Operation Twist program by $267 billion because growth in employment has slowed. The Fed said the program, of buying Treasury securities with maturities between six and 30 years and selling those of three years and less, will put downward pressure on longer-term interest rates and help make financial conditions more accommodative. In an 11 to 1 vote, the Fed also kept its federal funds target between 0% and 0.25% and reiterated that exceptionally low levels of rates are needed at least through late 2014. "The Committee anticipates that the unemployment rate will decline only slowly toward levels that it judges to be consistent with its dual mandate," the FOMC said, adding strains in global financial markets continue to pose significant downside risks and that inflation will run at or below the level most consistent with its dual mandate. The only dissent was Richmond Fed President Jeffrey Lacker, who opposed continuation of the maturity extension program.