After announcing that the Fed would undertake QE3 measures, the FOMC also said it would likely hold interest rates at the current rate until at least mid-2015, even though it had previously set a time line of late 2014.

Although stocks advanced, bond prices dropped as some investors worried that the aggressive easing of monetary policy might fuel inflation. In its statement, the Fed said the Mortgage Backed Securities purchases that will start Friday.

In the Fed's first two rounds of quantitative easing, dubbed QE1 and QE2, the central bank bought bonds closer to a pace around $100 billion per month, whereas QE3 will have the Fed purchasing $40 billion of mortgage debt a month.