Financial Times FT.com

Fed move to buy Treasuries stuns investors

By Krishna Guha in Washington

Published: March 19 2009 02:00 | Last updated: March 19 2009 02:00

The Federal Reserve yesterday stunned investors by announcing plans to buy $300bn (£210bn) of US government debt, triggering a plunge in bond yields and the dollar.

In a further display of aggression, the US central bank also said it was more than doubling its purchases of securities issued by housing giants Fannie Mae and Freddie Mac to $1,450bn. It said it now expected to keep interest rates near zero for an "extended period" of time.

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