Fed leaves buyback plan untouched, citing unemployment rates

"While the economic outlook was seen as improving, members generally felt that the change in the outlook was not sufficient to warrant any adjustments to the asset-purchase program, and some noted that more time was needed to accumulate information on the economy before considering any adjustment," the minutes stated.

The policy could change, depending on economic and financial developments, but some Fed officials said they had a "fairly high threshold" for making changes to the program. The program, dubbed "QE2," has been subject to controversy, including criticism from a variety of Republican lawmakers. They argued that the policy would create inflation, with some lawmakers going so far as arguing the Fed's mandate should be changed so it no longer pursues policies designed to maximize employment.

The minutes come just days before Fed Chairman Ben Bernanke is scheduled to testify before the Senate Budget Committee on the state of the U.S. economy at its Friday meeting.

Despite the general expectation that the economy was slowly recovering, Fed officials expressed concern about a number of factors that could drag it back down. The potential for further weakening of the housing market, which is already "quite depressed," the budgetary problems currently plaguing states and localities nationwide, and the chance that banking and sovereign problems in Europe could make their way to America were all cited as potential drags on the economy.

Fed officials reported that business contacts were generally optimistic about the economic outlook, but some were still reporting concerns about the effects of government policies on their business.