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Nov 6, 2013

Fed’s Pianalto sounds caution on continued bond-buying

By Jonathan Spicer

(Reuters) – The Federal Reserve should be cautious as it continues to buy up bonds, given the “uncertain economic environment” and the central bank’s limited experience with such quantitative easing programs, a top Fed policymaker said on Wednesday.

“My hope is that the economic recovery will accelerate so that the (Fed) gains the reassurance it needs to begin winding down the program,” Cleveland Fed President Sandra Pianalto told an Ohio housing conference.

Nov 1, 2013

Fed officials eye inflation, jobs in dueling QE arguments

LOUIS/NEW YORK, Nov 1 (Reuters) -

Top Federal Reserve officials on Friday gave only modest
hints as to when a massive bond-buying program would be drawn
down, with one saying they needed to wait for signs of rising
inflation and two others reinforcing an argument the Fed has
waited too long.

Investors are trying to predict when the Fed will decide the
U.S. economy and labor market are strong enough to withstand a
reduction in the pace of quantitative easing (QE), in which $85
billion in assets are snapped up by the central bank each month
to spur growth.

Nov 1, 2013

Fed’s Bullard urges taper patience while inflation low

LOUIS/NEW YORK (Reuters) – The Federal Reserve should wait for signs that U.S. inflation is heading higher before starting to scale back its massive bond buying program, a senior U.S. central banker said on Friday.

However, St. Louis Federal Reserve Bank President James Bullard declined to say if he thought that the Fed’s next meeting, in December, would be too soon to make the call.

Nov 1, 2013

Fed’s Plosser floats setting a cap on QE3

By Jonathan Spicer

(Reuters) – A top U.S. Federal Reserve official on Friday floated the idea of setting a maximum dollar amount for its current bond-buying program, which is now tied to an improved job market.

“I’m actually leaning to believe that’s a better way to get out of this,” Philadelphia Fed President Charles Plosser said on CNBC television, adding a cap on quantitative easing would allow the Fed to reassess the economy once it is done.

Nov 1, 2013

Pianalto’s departure a chance for Cleveland Fed to speak up

Nov 1 (Reuters) – Sandra Pianalto, a quietly ardent
supporter of Federal Reserve Chairman Ben Bernanke, turned some
heads this month when she came out against the central bank’s
recent decision to keep pumping so much money into the U.S.

Yet the speech by Pianalto, who is set to retire as
president of the Federal Reserve Bank of Cleveland early next
year, may set the tone for a yet-to-be-named successor who could
return Cleveland to its outspoken, inflation-fighting roots.

Oct 28, 2013
via MacroScope

Romer, taking aim at Fed, advocates ‘regime change’ and a shift to nominal GDP

By Alister Bull

Christina Romer, former chair of the White House Council of Economic Advisers and a strong advocate for Janet Yellen to take over from Ben Bernanke as the next chair of the Federal Reserve, slammed the Fed in a lecture last week that accused the U.S. central bank of being too meek and of fighting the wrong battle by being fixated on asset bubbles.

Romer, sometimes touted as a potential candidate to fill one of the 3 vacancies on the Fed’s Board in Washington, or maybe run a regional branch (Cleveland has an opening), also discussed deliberately aiming for 3 or 4 percent inflation, as well as targeting nominal GDP.

Oct 17, 2013

Fed’s default crisis tools back on the shelf – for now

NEW YORK (Reuters) – Federal Reserve officials sighed in relief on Thursday after the U.S. government avoided a potentially devastating default, relieving the central bank of the need to take yet more extraordinary measures to stabilize the financial system.

But with Washington’s borrowing authority only raised temporarily, the Fed may still be called on in the months ahead to deploy a largely experimental arsenal should another round of political dysfunction result in an actual default.

Oct 17, 2013

Fed needs ‘couple of meetings’ before cutting QE3: Evans

/NEW YORK (Reuters) – The Federal Reserve will likely defer any decision to trim its massive bond buys until at least December, two top Fed officials suggested on Thursday, although a third Fed policymaker made no bones about her view that she opposes any such delay.

A budget battle in Washington that shut government offices for 16 days and brought the United States to the brink of default has injected uncertainty into the economy’s growth trajectory.

Oct 17, 2013

Fed’s Fisher warns of potential U.S. housing bubble, MBS buys

NEW YORK (Reuters) – A top Federal Reserve official said on Thursday he is seeing fresh signs of a U.S. “housing bubble” and warned about the central bank’s ongoing purchases of mortgage-based bonds.

“I’m beginning to see signs not just in my district but across the country that we are entering, once again, a housing bubble,” Dallas Fed President Richard Fisher told reporters after a speech in New York. “So that leads me … to be very cautious about our mortgage-backed securities purchase program.”

Oct 15, 2013

Exclusive: Fed’s Fisher, vocal hawk, sees no QE cuts this month

NEW YORK (Reuters) – “Reckless” U.S. fiscal policy will likely force the Federal Reserve to stand pat on monetary policy this month, one of the Fed’s biggest critics of the U.S. central bank’s bond-buying program said on Tuesday.

Richard Fisher, the hawkish president of the Federal Reserve Bank of Dallas, said that the fiscal standoff means even he would find it difficult to make a case for scaling back bond purchases at the Fed’s policy meeting on October 29-30.