The Federal Reserve will not take up a new tool known as yield curve control, but said it will keep all of its options open in the future.

In minutes detailing the Federal Open Market Committee’s July 29 meeting, Fed officials appeared cool to a World War II-era policy of purchasing U.S. Treasuries until yields reach stated targets.

One reason: yields are already historically low across the curve. At the time of the meeting, the yield on the U.S. 10-year Treasury (^TNX) was below 60 basis points and the yield on the U.S. 30-year (^TYX) under 125 basis points.

FOMC members, who opted to hold interest rates at near-zero in that meeting, also flagged concerns over the consequences of an “excessively rapid expansion of the balance sheet” under a yield curve control policy. Questions also arose over how the Fed would exit such a strategy.

“In light of these concerns, many participants judged that yield caps and targets were not warranted in the current environment but should remain an option that the Committee could reassess in the future if circumstances changed markedly,” read the Fed minutes, which were released Wednesday.

The central bank had previously floated the idea of targeting medium-term U.S. debt (like the 3-year and 5-year), a version of yield curve control deployed by the likes of the Reserve Bank of Australia. But the July minutes suggest that the Fed would like to prioritize its communication policy instead of involving itself further in the U.S. government debt.

The Fed has also swatted down interest in following the European Central Bank and the Bank of Japan in their use of negative rates.

Forward guidance

The July discussion of yield curve control is a noticeable development since the Fed’s June 10 meeting, in which Fed officials debated the pros and cons of implementing such a policy and agreed to “conduct further analysis.”

With the tool likely sidelined for now, the Fed has its focus on forming some plan for forward guidance.

The central bank has already slashed rates to near-zero and committed to expanding the balance sheet through purchases with no maximum. But markets are still in the dark about how long the Fed will commit to keeping borrowing costs low and providing accommodation through its quantitative easing policies.

The July minutes detailed interest in both outcome-based forward guidance (where the Fed commits to keeping rates near-zero until inflation and/or unemployment reach stated goals) or calendar-based guidance (where the Fed commits to keeping rates near-zero until a certain date).