Wall Street’s biggest bond dealers see little chance the Federal Reserve will slow the pace of debt purchases designed to boost economic growth before the fourth quarter, even as policy makers face calls to curb the buying.
Philadelphia Federal Reserve Bank President Charles Plosser said an eventual withdrawal of Fed stimulus should include sale of securities on its balance sheet and a return to the federal funds rate as the main policy tool.
Two voting members of the Federal Reserve’s policy-setting panel stressed the need to maintain record stimulus to keep the expansion going, and they cited a job-market slowdown as evidence of risks to the economy.
Philadelphia Federal Reserve President Charles Plosser said the Fed should begin reducing the pace of bond buying, citing gains in the labor market since the start of a third round of asset purchases in September.
Federal Reserve Bank of Philadelphia President Charles Plosser said policy makers should watch the risk of accelerating mid-term inflation “very carefully” after injecting record stimulus into the economy.