Release Date: June 24, 2009

For immediate release

Information received since the Federal Open Market Committee met in April suggests that the pace of

economic contraction is slowing. Conditions in financial markets have generally improved in recent

months. Household spending has shown further signs of stabilizing but remains constrained by

ongoing job losses, lower housing wealth, and tight credit. Businesses are cutting back on fixed

investment and staffing but appear to be making progress in bringing inventory stocks into better

alignment with sales. Although economic activity is likely to remain weak for a time, the Committee

continues to anticipate that policy actions to stabilize financial markets and institutions, fiscal and

monetary stimulus, and market forces will contribute to a gradual resumption of sustainable economic

growth in a context of price stability.

The prices of energy and other commodities have risen of late. However, substantial resource slack is

likely to dampen cost pressures, and the Committee expects that inflation will remain subdued for

some time.

In these circumstances, the Federal Reserve will employ all available tools to promote economic

recovery and to preserve price stability. The Committee will maintain the target range for the federal

funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions are likely to warrant

exceptionally low levels of the federal funds rate for an extended period. As previously announced, to

provide support to mortgage lending and housing markets and to improve overall conditions in private

credit markets, the Federal Reserve will purchase a total of up to $1.25 trillion of agency mortgage-

backed securities and up to $200 billion of agency debt by the end of the year. In addition, the Federal

Reserve will buy up to $300 billion of Treasury securities by autumn. The Committee will continue to

evaluate the timing and overall amounts of its purchases of securities in light of the evolving economic

outlook and conditions in financial markets. The Federal Reserve is monitoring the size and

composition of its balance sheet and will make adjustments to its credit and liquidity programs as


Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley,

Vice Chairman; Elizabeth A. Duke; Charles L. Evans; Donald L. Kohn; Jeffrey M. Lacker; Dennis P.

Lockhart; Daniel K. Tarullo; Kevin M. Warsh; and Janet L. Yellen.

2009 Monetary Policy Releases