Federal Reserve announces new round of stimulus

To honor its mandate from Congress—keep inflation and unemployment in line—the Fed said it will spend $40 billion a month on bonds to get the economy moving and push down the unemployment rate. The announcement comes weeks after the annual economic symposium held in Jackson Hole, Wyo., where investors were hoping Fed Chairman Ben Bernanke would at least hint about another round of bond purchasing.

The Fed will tweak the program if inflation does become a concern, but until then, the Federal Open Market Committee will continue to purchase agency mortgage-backed securities “until such improvement is achieved in context of price stability.” The Fed also announced it will keep its federal fund rate at near zero through mid-2015.