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UPDATE 1-Fed's Bullard - Fed should retain MBS buying plan
Mon, 23rd Nov 2009 00:55
WASHINGTON, Nov 22 (Reuters) - A senior U.S. Federal Reserve official said on Sunday the central bank should keep alive a mortgage-backed securities buying program beyond a planned end-date to give policy-makers more flexibility as they help the economy recover from a painful recession.
'I have advocated to keep the asset purchase program open but at a very low level, and wait and see what happens, and as information comes in about the economy we can adjust that program while the federal funds rate remains at zero,' St. Louis Federal Reserve bank James Bullard said in an interview with Dow Jones newswire.
The Fed has committed to buying $1.25 trillion of mortgage-backed securities by the end of March. The Fed began buying MBS, mortgage agency debt and longer-term Treasury securities after it had cut rates to near zero but wanted to continue to provide a boost to the economy.
Bullard, who will be a voter on the Fed's policy-setting panel in 2010, said with
rates near zero 'we'd be able to send signals to the markets about what we are thinking about the economy, and how much accommodation the economy needs at various points, by adjusting the asset purchases.'
(Washington newsroom 1 202 898 8300)
Keywords: USA FED/BULLARD
COPYRIGHT
Copyright Thomson Reuters 2009. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
'I have advocated to keep the asset purchase program open but at a very low level, and wait and see what happens, and as information comes in about the economy we can adjust that program while the federal funds rate remains at zero,' St. Louis Federal Reserve bank James Bullard said in an interview with Dow Jones newswire.
The Fed has committed to buying $1.25 trillion of mortgage-backed securities by the end of March. The Fed began buying MBS, mortgage agency debt and longer-term Treasury securities after it had cut rates to near zero but wanted to continue to provide a boost to the economy.
Bullard, who will be a voter on the Fed's policy-setting panel in 2010, said with
(Washington newsroom 1 202 898 8300)
Keywords: USA FED/BULLARD
COPYRIGHT
Copyright Thomson Reuters 2009. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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