Federal Reserve policy makers will replace some bonds in theirportfolio with longer-term Treasuries in an effort to furtherreduce borrowing costs and keep the economy from relapsing into arecession.

The central bank will buy $400 billion of bonds with maturitiesof six to 30 years through June while selling an equal amount ofdebt maturing in three years or less, the Federal Open MarketCommittee said today in Washington after a two-day meeting.

The action is intended to “put downward pressure on longer-terminterest rates and help make broader financial conditions moreaccommodative,” the FOMC said in a statement. The Fed will alsoreinvest maturing mortgage debt into mortgage-backed securitiesinstead of Treasuries. Three officials dissented, the same as atthe prior meeting in August.

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