Fed Brightens Recovery View as Bernanke Sets Stage to End Bond Buys .

Federal Reserve officials on Wednesday upgraded their assessment of the U.S. economic recovery, and Chairman Ben Bernanke said the central bank could begin pulling back its $85 billion-per-month bond-buying program later this year.

"Labor market conditions have shown further improvement in recent months," the Fed said in its formal policy statement, though it noted that unemployment remains "elevated." Fed officials also noted that they see "the downside risks to the outlook for the economy and the labor market as having diminished since the fall."

The Fed took no immediate action, as officials voted to keep the amount of bonds the central bank is buying each month unchanged for the time being, at $40 billion per month of agency mortgage-backed securities and $45 billion of Treasury securities.