The economy is growing, the labor market is improving and inflation is nothing to worry about. That's the Federal Reserve's widely-anticipated assessment of the economy, released Wednesday after a two-day meeting.
The Fed said it would keep interest rates at historic lows near zero and that it would continue its bond buying program, known as quantitative easing, aimed at keeping the central bank's pedal to the metal on stimulating growth.
But in a post-meeting news conference, Federal Reserve Chairman Ben Bernanke hinted that the curtain may begin to come down on the days of extremely easy money.
The Fed's statement itself gave no obvious clues that it would be scaling back the program, despite intense market speculation that it could start drawing it to a close. But financial markets took the Fed's rosier view of the economy as a clue that it was inching closer to paring back the program.
And Bernanke said if the economy continues to improve the asset-purchasing program could start winding down towards the end of 2013 and wrap up in 2014. He left the door open to continue the program longer, however, if economic conditions don't improve enough.
Markets sold off aggressively on the news, with major averages dropping more than 1 percent. The five-year Treasury note hit its highest yield since August 2011 while the benchmark 10-year note breached a 2011 high.
Markets have been intent on finding signs for when the Fed will end its quantitative easing program, which has driven the central bank balance sheet to $3.45 trillion and sparked worries about asset bubbles in risk assets.
The Fed credits itself with funds that it uses to buy Treasurys and mortgage-backed securities.
As part of a historic level of easing, the Fed also has kept its target funds rate near zero, where it will stay until unemployment falls to 6.5 percent and inflation rises to 2.5 percent. The jobless rate currently stands at 7.6 percent while inflation is tracking at 1.4 percent.
In its statement Wednesday, it forecast the jobless target will be hit in 2014. It also cut its inflation forecast.
Critics have wondered why the central bank continues in extreme easing mode even though the economy is well enough and the S&P 500 stock index has gained more than 140 percent since the March 2009 lows.
CNBC's Jeff Cox, Reuters and NBC News' Patrick Rizzo contributed to this report.