Fed reduced bond buys after seeing big job gains The Federal Reserve agreed last month to modestly reduce its bond purchases by $10 billion a month after seeing stronger job gains and other signs of an improving economy. But minutes of the December 18-19 meeting show some participants worried that financial markets might misread the move as a step toward raising its key short-term interest rate. The bond purchases are intended to keep long-term rates low. In response, the Fed said it would keep its short-term rate low "well past" the time the unemployment rate dropped below 6.5 percent, as long as inflation stayed low. Some members wanted to lower the unemployment threshold to 6 percent. But the majority wanted to make no change to the threshold.