Federal Reserve to Reduce Monthly Bond Purchases Further

Tapering continues tapering down

The Federal Reserve says it will cut its monthly bond purchases by an additional $10 billion to $65 billion because of a strengthening U.S. economy. It's doing so even though the prospect of reduced Fed stimulus and higher U.S. interest rates has rattled global markets.

The Fed also reaffirmed its plan to keep short-term rates at record lows in a statement it issued Wednesday after Ben Bernanke's final policy meeting. Bernanke will step down Friday after eight years as chairman.

Many global investors fear that reduced Fed bond buying will boost U.S. rates and cause investors to move money out of emerging markets and into the United States for higher returns. Currency values in emerging nations have fallen. India, Turkey and South Africa have raised rates to try to protect their currencies.