Fed to buy $300 billion in long-term Treasurys

WASHINGTON (MarketWatch) -- The Federal Reserve on Wednesday said it would buy $300 billion in longer-term Treasury bonds to help arrest a deepening slide in the U.S. economy, a surprise move that sent stocks soaring and triggered violent moves in other markets.

The Federal Reserve's move, one of several actions taken Wednesday aimed at making it less expensive to borrow money, signaled it will boost the size of its balance sheet to more than $4 trillion. Today's moves double the amount of money the central bank has poured into the economy to try to stimulate economic activity.

"The Fed has upped the ante on its policy actions, and in a big way," said Richard Moody, chief economist at Forward Capital LLC in Austin, Texas.

Following the Fed decision, gold futures and U.S. stocks rallied, while the dollar plunged against other majorcurrencies. (more)