As part of its continuing effort to return to normal operations, the Federal Reserve's policymaking committee said Wednesday that the central bank will hold a final cash auction on March 8.

When they were launched in December 2007, the auction was seen as a way for banks to borrow from the Fed without encountering the stigma associated with discount window loans. The Fed initially auctioned off $20 billion of cash through the program but later gave out as much as $150 billion as the financial crisis deepens.

On Wednesday, the Fed said it would hold a $50 billion auction on Feb. 8 followed by a final, $25 billion auction on March 8.

The Fed is in the process of shuttering four other liquidity facilities on Feb. 1.

Meanwhile, the central bank held firm Wednesday to its commitment to end purchases of debt and mortgage-backed securities from the government-sponsored enterprises by March 31. There has been debate over whether the Fed should continue the purchases to avoid a sudden jump in mortgage rates.

In light of that concern, the Treasury Department announced additional support for Fannie Mae and Freddie Mac with the hopes of avoiding further instability in the mortgage market.

The Fed said Wednesday that "economic activity continued to strengthen" in recent weeks but noted that "bank lending continues to contract."

The central bank kept the target federal funds rate at a range between 0% and 0.25% and again said rates will remain low "for an extended period." Thomas Hoenig, the president of the Federal Reserve Bank of Kansas City, dissented from the decision, arguing that financial conditions no longer required such low interest rates.

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