Fed Officials Assess Trimming QE3

One top Federal Reserve official said on Wednesday he was open-minded about reducing stimulus this month, as investors largely expect the central bank to do, while another policymaker said the U.S. central bank should actually do more for the economy.

The comments by San Francisco Fed President John Williams and Narayana Kocherlakota, his counterpart in Minneapolis, reflect the uncertainty that lingers over financial markets two weeks before the Fed’s 19 policymakers meet to decide whether to adjust a $85-billion monthly bond-buying program.

The quantitative easing program, known as QE3 because it is the Fed’s third such massive effort to boost growth and employment since the Great Recession, was launched a year ago. U.S. unemployment was 7.4 percent in July, down from 8.2 percent a year earlier, suggesting to many economists that the Fed is ready to reduce the pace of buying.


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