Tuesday, August 9, 2011

Fed ready to launch QE3: Rogoff


Federal Reserve policy makers are likely to embark on a third round of large-scale asset purchases, moving “more decisively” to secure the US recovery, Harvard University economist Ken Rogoff says.

“They certainly should do something right away,” said Rogoff, a former International Monetary Fund chief economist who attended graduate school with Fed chairman Ben Bernanke. It’s “hard to know” if Mr Bernanke would immediately be able to gain the support of Federal Open Market Committee members, Mr Rogoff said in an interview today on Bloomberg Television.

The FOMC meets later today in Washington a day after the worst day for US stocks since December 2008. Bernanke last month outlined policy options including additional asset purchases or strengthening the commitment to low interest rates after the first two rounds of so-called quantitative easing failed to keep the unemployment rate below 9 per cent.

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