Fed buys more treasuries and holds rates

The Federal Reserve has announced it will buy American treasuries with the proceeds from its mortgage investments in an attempt to stave off a double-dip recession.

The return to easing stops short of printing more money, but prevents a decline in the size of the Fed’s balance sheet.

Fed officials had downgraded the economic growth outlook for America following cautious statements from chairman Ben Bernanke in recent months. (article continues below)

Rates were held at their record lows and would remain there for “an extended period”, according to the Federal Open Markets Committee.