The betting markets are watching the upcoming US presidential elections.
But they aren’t sure how to predict what the result will be.
It’s a problem for the Federal Reserve, which is facing a massive bond-buying binge that could cause a surge in inflation, the Wall Street Journal reported Thursday.
In a statement, the Fed said the election has been a “challenge for the financial markets,” as the results of the presidential races in both parties have been closely watched.
The Fed said that the financial sector “has a significant role” in the outcome of the upcoming elections.
It said the Fed is monitoring the markets’ reaction to the news, and that it will take “appropriate actions if warranted.”
Fed officials said the economic recovery has been impressive, but that the Fed has to continue to strengthen the recovery.
“The central bank has seen a number of events over the past several months that have changed the dynamics of economic activity,” Fed Chair Janet Yellen said in a statement.
“In addition, it is difficult to predict how the outcome will be determined in the coming months.”
Banks have been trying to raise money and sell their bonds in the wake of the election.
But the Fed may have another challenge in the next months.
In a speech at the National Press Club in Washington, the central bank’s deputy governor, Stanley Fischer, said the economy has recovered at a slower rate than expected, and the economy is starting to slow down.
The economy is “not growing as fast as expected,” Fischer said.
“The unemployment rate has fallen, the unemployment rate is declining.”
Fischer said the central banks monetary policy “has remained accommodative.”
The Fed’s latest bond purchases will increase its balance sheet by $3.4 trillion in September, the second month in a row the Fed raised its holdings of Treasury and mortgage-backed securities.
In addition, the U.S. central bank is buying about $3 trillion in Treasury and other debt.
The Federal Reserve’s bond purchases come as the economy recovers from the recession that began in 2007.
Economists have long expected the Fed to do a “mini-pump” of stimulus in the months ahead.