WASHINGTON Top Congressional Republicans on Tuesday took the unusual step of telling the Federal Reserve to refrain from further "intervention" in the economy on the eve of the central bank's policy decision.
The group said the Fed's policies have been ineffective at supporting economic expansion and boosting employment.
"It is not clear that the recent round of quantitative easing undertaken by the Federal Reserve has facilitated economic growth or reduced the unemployment rate," the group, which included the top two Republicans in both chambers of Congress, wrote in a letter to Fed Chairman Ben Bernanke.
It was a rare direct recommendation from Capitol Hill on monetary policy, which is supposed to be conducted free of political pressure. The U.S. central bank on Wednesday is widely expected to announced further steps to keep long-term interest rates down to fuel a stronger recovery.
The Fed said it had received the letter, which was released by Republican leaders, but it had no further comment.
The central bank cut overnight interest rates to near zero in December 2008 and then took the unprecedented step of outright asset purchases, more than tripling its balance sheet to $2.9 trillion in the process.
Fed officials argue that, while growth remains anemic, its unconventional monetary support had at least forestalled a prolonged period of deflation -- a potentially crippling broad decline in prices.
But with policy already loose, the Republican lawmakers told Bernanke the risks of another dose of unorthodox policy are too great even with an unemployment rate stuck above 9 percent.
"We have serious concerns that further intervention by the Federal Reserve could exacerbate current problems or further harm the U.S. economy," the letter said.
Last year, the Fed drew sharp criticism from Republicans on Capitol Hill for a $600 billion round of bond purchases that they argued was laying the groundwork for future inflation.
Leaders in emerging markets also cried foul, saying the Fed's policy was a backdoor devaluation of the U.S. dollar that was damaging their economies.
Earlier this year, Republican lawmakers blocked President Barack Obama's nomination of MIT professor Peter Diamond to serve on the central bank's board. Diamond, a Nobel laureate, had voiced support for the Fed's easy-money policies.
Indeed, the Fed has become a campaign issue ahead of next year's presidential elections. Republican contender and former Massachusetts Governor Mitt Romney said he would not reappoint Bernanke, while Texas Governor Rick Perry, another leading Republican candidate, called the Fed chief's actions "treasonous."
"If this guy prints more money between now and the election, I don't know what y'all will do to him in Iowa, but we would treat him pretty ugly down in Texas," Perry told supporters in Iowa last month.