Fed Tapers QE by $10B

What was expected happened.  The Fed cut rates by $10B/ month.

As Ben Bernanke said:

Reflecting cumulative progress and an improved outlook for the job market, the committee decided today to modestly reduce the monthly pace at which it is adding to the longer-term securities on its balance sheet.”

 According to Bloomberg Bernanke said:

 "The steps that we take will be data dependent,” Bernanke said. “If we’re making progress in terms of inflation and continued job gains, then I imagine we’ll continue to do, probably at each meeting, a measured reduction” in purchases. If the economy slows, the Fed could “skip a meeting or two,” and if the economy accelerates it could taper a “bit faster,” he said.

 As for borrowing costs:

 At the same time, the Fed reinforced its assurances that it’s a long way from raising borrowing costs, saying that its benchmark rate is likely to stay low “well past the time that the unemployment rate declines below 6.5 percent, especially if projected inflation continues to run below” the Fed’s 2 percent goal.