Fed to launch MBS buying agency in January

WASHINGTON (Reuters) - The Federal Reserve confirmed on Tuesday it will begin buying mortgage-backed securities in early January with an aim of purchasing $500 billion dollars worth by the end of June under a program announced last month.

The Fed said it had selected investment managers BlackRock Inc , Goldman Sachs Asset Management , PIMCO, and Wellington Management Co to implement the program, which will purchase mortgage backed securities (MBS) issued by issued by mortgage agencies Fannie Mae, Freddie Mac, and Ginnie Mae.

The agency MBS buying program is part of a sustained government effort to help the U.S. withstand a severe credit crunch and a deep housing downturn that have tipped the economy into recession and hurt economic activity around the world.

As part of the program announced in November, the Fed also said it would buy up to $100 billion in debt issue by Fannie Mae, Freddie Mac and the Federal Home Loan Banks.

"The goal of the program is to provide support to mortgage and housing markets and to foster improved conditions in the financial markets generally," the Fed said in a statement on Tuesday.

(Reporting by Mark Felsenthal)