US Fed dashes hopes of early stimulus

The Federal Reserve dashed hopes for an early dose of extra monetary stimulus to boost the sluggish US economy, sticking to its existing programme of bond purchases but promising to "closely monitor" developments.

The central bank's Federal Open Market Committee pushed off a decision on whether to launch a new round of bond buying, a tactic called quantitative easing that is designed to push down market interest rates to make it easier for homeowners to refinance their mortgages and small businesses to get loans for expansion.

Doveish members of the committee have argued publicly for more action from the Fed to stimulate the economy, but their concerns were reflected only in language that recognised the disappointing pace of recovery.