The Federal Reserve ramped up monetary stimulus by expanding
"Operation Twist", but disappointed some investors who had been hoping
for more aggressive measures.
The U.S. central bank, as expected, extended its program of selling short-term securities and buying longer-dated ones, a move aimed at driving down borrowing costs, but did not signal a third round of quantitative easing. "The positive impact of a weaker yen should outweigh the disappointment about the U.S.'s economic outlook and the lack of more powerful stimulus," The Fed also slashed its forecast for U.S. economic growth, hitting commodities sensitive to expectations for industrial demand.
A Reuters poll showed Wall Street's top bond firms still see a 50 percent chance of a third bout of quantitative easing or "QE3", under which the Fed effectively creates money to fund large asset purchases, to stimulate the economy.
"Clearly, the tilt is to do more. QE3 is one of those options," said Julia Coronado, chief economist North America at BNP Paribas in New York.
The decision to hold off on QE3 for now boosted the dollar against the euro and the yen and also hit gold, which had been rising as investors betting on QE3 had bought the precious metal as a hedge against currency depreciation.
The Indian Market nearest support is at 5113 and 5106 sustaining below this level for 30 min nifty will slide to 5073 level straight. and any close below 5020 we will see panic selling till 4978 -4920.
