There are some significant differences between the text released Wednesday by the Federal Open Market Committee, and the one it issued after its previous gathering in April.
All the changes suggest Ben Bernanke and most of the rest of the Federal Reserve's policy-setting body have serious concerns about the state of the U.S. economy. A third round of quantitative easing is very much a possibility if the next jobs report disappoints.
It very well could, judging by the tone of the FOMC statement.
"The committee expects economic growth to remain moderate over the coming quarters and then to pick up very gradually," policy makers said. Note the adverb: very. That wasn't there in April. Gradual economic growth could conceivably lower the unemployment rate; very gradual growth might not.
Non-farm payrolls in the U.S. increased by a mere 69,000 in May, the weakest result in a year, and the unemployment rate rose to 8.2 per cent from 8.1 per cent in April.
"Growth in employment has slowed in recent months, and the unemployment rate remains elevated," the FOMC said. That's more than a statement of the obvious. In Fed speak, acknowledgement of reality is a sign of concern.
The other important change in the statement is this one: "The committee is prepared to take further action as appropriate to promote a stronger economic recovery and sustained improvement in labour market conditions in a context of price stability."
That's the line that shows QE3, while never off the table, is now square in the middle rather than sitting off to the side. In April, the FOMC simply said it would continue to review the "size and composition" of its securities holdings in order to promote stronger growth.
The Fed did that Wednesday by extending Operation Twist through the end of the year. But policy makers don't want anyone thinking they are out of ammunition. If the economic indicators continue to deteriorate ahead of the FOMC's next gathering at the end of July, policy makers will be making another trip to the armory.