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The Fed also said it would continue purchasing $85 billion in mortgage and Treasury bonds each month. The purchases are intended to lower long-term rates and encourage more borrowing and spending. But Chairman Ben Bernanke said after the meeting that the Fed could slow those purchases later this year if the economy continued to strengthen. Most economists interpreted his remarks that to mean the Fed could begin to scale back its bond buying at its September meeting. Stock and bond prices fell sharply in the days after his comments. However this week Bernanke stressed that the economy still needs the Fed's low interest-rate policies because unemployment remains high and inflation is below the Fed target. His comments were his latest attempt to stress that the Fed will continue to stimulate the economy, even after it begins to slow the bond purchases. "A highly accommodative monetary policy for the foreseeable future is what is needed for the U.S. economy," Bernanke told the National Bureau of Economic Research on Wednesday. The comments helped drive the Dow Jones industrial average and the Standard & Poor's 500 index to all-time highs on Thursday.
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