Insight: Prolonged Operation Twist May Get Close FOMC Look

http://www.forexlive.com/blog/2012/05/29/insight-prolonged-operation-twist-may-get-close-fomc-look/

(MNI) – Should Federal Reserve policymakers decide that additional
monetary stimulus is needed at their June meeting — and that is not a
foregone conclusion — there is substantial sentiment for perpetuating
the soon-to-expire “Maturity Extension Program” or “Operation Twist.”
The alternative would be a third round of large-scale asset
purchases or “quantitative easing” (QE3), but there are those on the
Fed’s policymaking Federal Open Market Committee who see disadvantages
to doing so.
In Operation Twist, a $400 billion program due to expire on June
30, the Fed sells short-term U.S. Treasury securities from its portfolio
and uses the proceeds to buy long-term securities, resulting in no net
change in the Fed’s balance sheet or the supply of reserves.