The Federal Reserve on Wednesday said it would scale back the stimulus by an additional $10 billion.
The Fed said its monthly purchase of U.S. Treasury and mortgage-backed securities would be trimmed to $55 billion, down from $65 billion.
In a statement, the Federal Open Market Committee, which makes monetary policy for the Federal Reserve System, said it "currently judges that there is sufficient underlying strength in the broader economy to support ongoing improvement in labor market conditions."
"In light of the cumulative progress toward maximum employment and the improvement in the outlook for labor market conditions since the inception of the current asset purchase program, the Committee decided to make a further measured reduction in the pace of its asset purchases," the statement added.
Back in December, the Fed said it would start unwinding and eventually discontinue its bond-buying program beginning in January, citing improvements to the economy and progress in the labor market.
Previously, the Fed stated that it would "likely will be appropriate" to keep rates near zero "well past the time that the unemployment rate declines below 6.5 percent." The unemployment rate is now at 6.7 percent.
But the Fed is now getting rid of a specific unemployment rate target to help determine when it could possibly raise short-term rates. The Fed said it would instead keep its eye on other information, like "measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments."