Fed to buy more treasuries in bid to revive growth

The Federal Reserve plans to reinvest principal payments on its mortgage holdings into long-dated treasuries in an effort to revive the stuttering US economic recovery.

Dubbed ‘QE lite', the measures are the first from US authorities in about a year to bolster the sluggish economy. The first round of QE saw the central bank buy $1.7trn of mortgage-related securities and US treasuries. "Information received since the Federal Open Market Committee met in June indicates that the pace of recovery in output and employment has slowed in recent months," the Fed says. "To help support the economic recovery in a context of price stability, the Committee will keep constant the Federal Reserve's holdings of securities at their current level by reinvesting pr...