The Washington Times - October 24, 2012, 02:38PM

The Federal Reserve made no changes in its program to drive down long-term interest rates at a meeting of its policy committee Wednesday.

The central bank noted in a statement that the economy has improved somewhat since its last meeting six weeks ago, with consumer spending picking up and the housing market continuing its recovery.

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But it said that despite a drop in the unemployment rate to 7.8 percent last month, joblessness remains “elevated” and businesses have pared their spending plans, so it must maintain its extremely accommodative interest rates policies to nurture a faster recovery.

“Economic activity has continued to expand at a moderate pace,” the statement said, but “the committee remains concerned that, without sufficient policy accommodation, economic growth might not be strong enough to generate sustained improvement in labor market conditions.”

The Fed has been purchasing about $85 billion a month in mortgage bonds, driving 30-year mortgage rates to the lowest levels on record, around 3.5 percent. Its launch of the program last month sparked the biggest refinancing boomlet since 2009, but that wave has started to wane somewhat.

The Mortgage Bankers Association on Wednesday reported a 13 percent drop in refinancing applications last week as the average 30-year mortgage rate ticked up slightly to 3.63 percent from 3.57 percent the week before.