16 Jan 2014
Fed's Williams calls for more research on QE effects
FXstreet.com (Łodź) - San Francisco Fed president John Williams said on Thursday that the impact of asset purchases on markets is still uncertain and that it should be analyzed more in-depth.
"There are nagging concerns that large-scale asset purchases carry with them particular risks to the economy or the health of the financial system that we still don't fully understand," he warned.
The Fed head called for more research on the effects of QE on markets and the economy to determine whether they should “be a standard tool of monetary policy at the [zero-lower bound], and, if so, how should they be implemented?”
He also criticized the forward guidance policy adopted by the Fed last year, describing it as "overly simplified and prone to misinterpretation."
"There are nagging concerns that large-scale asset purchases carry with them particular risks to the economy or the health of the financial system that we still don't fully understand," he warned.
The Fed head called for more research on the effects of QE on markets and the economy to determine whether they should “be a standard tool of monetary policy at the [zero-lower bound], and, if so, how should they be implemented?”
He also criticized the forward guidance policy adopted by the Fed last year, describing it as "overly simplified and prone to misinterpretation."