News / Economy

US Central Bank Launches New Economic Stimulus

VOA News
The U.S. central bank launched new measures Thursday to try to stimulate the weak U.S. economy, even as it predicted that the country's economic fortunes would improve over the next two years.

The Federal Reserve said it would buy $40 billion a month of securities supported by real estate loans in its latest effort to boost economic growth and spur slack hiring in the country's labor market.   It said the U.S. economy, the world's largest, would advance no more than two percent this year, but could expand by as much as three percent next year and 3.8 percent in 2014.

The Fed placed no time limit on the new purchase of securities.  It said that if the country's job market "does not improve substantially," the central bank would buy more mortgage-backed securities and other assets, as well as "employ its other policy tools" to advance the U.S. economy.  

Federal Reserve Chairman Ben Bernanke called the slow creation of jobs in the United States a "grave concern" for the country.

"While the economy appears to be on a path of moderate recovery, it isn't growing fast enough to make significant progress reducing the unemployment rate. Fewer than half of the eight million jobs lost in the recession have been restored.  And at 8.1 percent, the unemployment rate is nearly unchanged since the beginning of the year and is well above normal levels. The weak job market should concern every American. High unemployment imposes hardship on millions of people and it entails a tremendous waste of human skills and talent," Bernanke said.

The Fed also said it would extend the timetable to keep its key lending rate near zero percent from late 2014 at least through mid-2015.  The central bank said it expects that eased financing "will remain appropriate for a considerable time," even after the U.S. economy strengthens from its current sluggish pace.

The policymakers, who met in Washington for the last two days, have been stymied in their effort to advance the U.S. economy beyond the meager 1.7 percent growth it recorded in the April-to-June period.  The Fed has bought more than $2 trillion worth of U.S. Treasury bonds and home loan securities since the world financial crisis began in 2008, but the country's economic growth has remained sluggish.

Stock investors applauded the Fed's new action.  The bellwether Dow Jones Industrial Average of key stocks surged 1.5 percent in late day trading.

The U.S. government reported last week that the country's labor market added only 96,000 jobs in August, not nearly enough to reduce the country's unemployment count of nearly 13 million workers.  The jobless rate has been above an unusually high eight percent level for 43 straight months.  The Fed projected the rate will decrease slowly over the next three years, to as low as six percent by the end of 2015.

The government said Thursday the number of Americans making first-time claims for jobless benefits last week increased by 15,000 to 382,000, another sign of slow job growth.

The central bank maintains political neutrality in the U.S.  But its latest stimulus lands in the final stages of the country's presidential election campaign, where the state of the economy is the key issue.

Republican challenger Mitt Romney says the incumbent Democrat, President Barack Obama, has failed in his oversight of the American economy and that he would not reappoint Bernanke when his Fed chairmanship ends in early 2014. Obama has pointed to 30 months of job growth in the U.S. and says Romney would return to policies that led to the worst U.S. economic downturn since the Great Depression of the 1930s.

You May Like

Video Americans, Tourists, Reflect on Meaning of Thanksgiving

VOA garnered opinions from several people soon after November 13 Paris attacks, which colored many of their thoughts

Video Thais Send Security Concerns Down the River

In northern Thailand, the annual tradition of constructing floating baskets to carry away the year’s bad spirits highlights the Loy Krathong festival

Video Tree Houses - A Branch of American Dream

Workshops aimed at teaching people how to build tree houses have become widely popular in America in recent years

This forum has been closed.
Comment Sorting
by: Anonymous from: almoros idriss
September 14, 2012 7:11 AM
SO great and excellent news! Thank you so much the US central bank! All have been pombing trillions, Why not USA? Where will those trillions of dollars extracted or stored in unknown world treasures and holes, come from? USA and the freeworld have almost all the intellectual properties, resources and highest technologies and millions of world developments' professionals there have been dying and ran out of money; Why?
USA and the western world, haven't to beg, BUT to lead!

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Islamic State Unfazed by Losses in Iraq, Syriai
November 26, 2015 5:21 AM
Progress in the U.S.-led effort to beat Islamic State on its home turf in Iraq and Syria has led some to speculate the terror group may be growing desperate. But counterterror officials say that is not the case, and warn the recent spate of terror attacks is merely part of the group’s evolution. VOA National Security correspondent Jeff Seldin has more.

Video Islamic State Unfazed by Losses in Iraq, Syria

Progress in the U.S.-led effort to beat Islamic State on its home turf in Iraq and Syria has led some to speculate the terror group may be growing desperate. But counterterror officials say that is not the case, and warn the recent spate of terror attacks is merely part of the group’s evolution. VOA National Security correspondent Jeff Seldin has more.

Video Taiwan Looks for Role in South China Sea Dispute

The Taiwanese government is one of several that claims territory in the hotly contested South China Sea, but Taipei has long been sidelined in the dispute, overshadowed by China. Now, as the Philippines challenges Beijing’s claims in an international court at The Hague, Taipei is looking to publicly assert its claims. VOA’s Bill Ide has more from Beijing.

Video Syrian Refugees in US Express Concern for Those Left Behind

Syrian immigrants in the United States are concerned about the negative tide of public opinion and the politicians who want to block a U.S. plan to accept 10,000 Syrian refugees. Zlatica Hoke reports many Americans are fighting to dispel suspicions linking refugees to terrorists.

Video After Paris Attacks, France Steps Up Fight Against IS

The November 13 Paris attacks have drawn increased attention to Syria, where many of the suspected perpetrators are said to have received training. French President Francois Hollande is working to build a broad international coalition to defeat Islamic State in Syria and in Iraq. Zlatica Hoke reports.

Video US, Cambodian Navies Pair Up in Gulf of Thailand

The U.S. Navy has deployed one of its newest and most advanced ships to Cambodia to conduct joint training drills in the Gulf of Thailand. Riding hull-to-hull with Cambodian ships, the seamen of the USS Fort Worth are executing joint-training drills that will help build relations in Southeast Asia. David Boyle reports for VOA from Preah Sihanouk province.

Video Americans Sharpen Focus on Terrorism

Washington will be quieter than usual this week due to the Thanksgiving holiday, even as Americans across the nation register heightened concerns over possible terrorist threats. VOA’s Michael Bowman reports new polling data from ABC News and the Washington Post newspaper show an electorate increasingly focused on security issues after the deadly Islamic State attacks in Paris.

Video World Leaders Head to Paris for Climate Deal

Heads of state from nearly 80 countries are heading to Paris (November 30-December 11) to craft a global climate change agreement. The new accord will replace the Kyoto Protocol on Climate Change that expired in 2012.

Video Uncertain Future for Syrian Refugee Resettlement in Illinois

For the trickle of Syrian refugees finding new homes in the Midwest city of Chicago, the call to end resettlement in many U.S. states is adding another dimension to their long journey fleeing war. Organizations working to help them integrate say the backlash since the Paris attacks is both harming and helping their efforts to provide refugees sanctuary. VOA's Kane Farabaugh reports.

Video Creating Physical Virtual Reality With Tiny Drones

As many computer gamers know, virtual reality is a three-dimensional picture, projected inside special googles. It can fool your brain into thinking the computer world is the real world. But If you try to touch it, it’s not there. Now Canadian researchers say it may be possible to create a physical virtual reality using tiny drones. VOA’s George Putic reports.

Video New American Indian Village Takes Visitors Back in Time

There is precious little opportunity to experience what life was like in the United States before its colonization by European settlers. Now, an American Indian village built in a park outside Washington is taking visitors back in time to experience the way of life of America's indigenous people. Carol Pearson narrates this report from VOA's June Soh.

Video Even With Hometown Liberated, Yazidi Refugees Fear Return

While the northern Iraqi town of Sinjar has been liberated from Islamic State forces, it's not clear whether Yazidi residents who fled the militants will now return home. VOA’s Mahmut Bozarslan talked with Yazidis, a religious and ethnic minority, at a Turkish refugee camp in Diyarbakır. Robert Raffaele narrates his report.

Video Nairobi Tailors Make Pope Francis’ Vestments

To ensure the pope is properly attired during his visit, the Kenya Conference of Catholic Bishops asked the Dolly Craft Sewing Project in the Nairobi slum of Kangemi to make the pope's vestments, the garments he will wear during the various ceremonies. Jill Craig reports.

Video Cross-Border Terrorism Puts Europe’s Passport-Free Travel in Doubt

The fallout from the Islamic State terror attacks in Paris has put the future of Europe’s passport-free travel area, known as the "Schengen Zone," in doubt. Several of the perpetrators were known to intelligence agencies, but were not intercepted. Henry Ridgwell reports from London European ministers are to hold an emergency meeting Friday in Brussels to look at ways of improving security.

Video El Niño Brings Unexpected Fish From Mexico to California

Fish in an unexpected spectrum of sizes, shapes and colors are moving north, through El Niño's warm currents from Mexican waters to the Pacific Ocean off California’s coast. El Nino is the periodic warming of the eastern and central Pacific Ocean. As Faiza Elmasry tells us, this phenomenon thrills scientists and gives anglers the chance of a once-in-a-lifetime big catch. Faith Lapidus narrates.

Video Terrorism in Many Forms Continues to Plague Africa

While the world's attention is on Paris in the wake of Friday night's deadly attacks, terrorism from various sides remains a looming threat in many African countries. Nigerian cities have been targeted this week by attacks many believe were staged by the violent Islamist group Boko Haram. In addition, residents in many regions are forced to flee their homes as they are terrorized by armed militias. Zlatica Hoke reports.

Video Study: Underage Marriage Rate Higher for Females in Pakistan

While attitudes about the societal role of females in Pakistan are evolving, research by child advocacy group Plan International suggests that underage marriage of girls remains a particularly big issue in the country. VOA’s Ayesha Tanzeem reports how such marriages leads to further social problems.

VOA Blogs

World Currencies


Rates may not be current.