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Stocks slide as Fed says bond purchases could slow

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The stock market shuddered as the Fed said it may start scaling back its $85 billion a month in bond purchases this year and end them by mid-2014. They have stimulated the economy, keeping interest rates low and lifting stocks. Bond and currency markets reacted even more sharply. The 10-year Treasury note’s yield jumped to 2.31%, highest since March 2012. The dollar surged against the yen, euro, and other currencies as traders anticipated higher interest rates. For weeks investors have been trying to figure out when the Fed will start to taper off its purchases. The Fed ‘is really trying to walk a tightrope,’ said George Rusnak, at Wells Fargo.

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