U.S. Federal Reserve officials have raised their forecasts for economic growth, but remain unhappy with the job market's recovery. In January they judged the economy still in need of support from the Fed's seven-month, $600 billion bond-buying program.
As they prepare for their next policy-setting meeting on March 15, central bank officials are weighing the benefits of continuing that support against the risk of allowing the economy to overheat.
The following are recent comments from Fed policymakers (* denotes 2011 voting member of the Federal Open Market Committee, which sets U.S. monetary policy).
ST. LOUIS FED PRESIDENT JAMES BULLARD, February 24
"The natural debate now is whether to complete the program or to taper off to a somewhat lower level of assets... Perhaps global inflation will drive U.S. prices higher or cause other problems."
KANSAS CITY FED PRESIDENT THOMAS HOENIG, February 23
"You have to calibrate your monetary policy with the recovery in the economy so you don't overshoot and cause the next crisis...You shouldn't tell the market that you will have very low interest rates for an extended period of time because it invites speculation."
* PHILADELPHIA FED PRESIDENT CHARLES PLOSSER, February 23
"Should economic prospects continue to strengthen, I would not rule out changing the policy stance to bring QE2 to an early close."
* FED CHAIRMAN BEN BERNANKE, February 18
"Capital flows are once again posing some notable challenges for international macroeconomic and financial stability."
* DALLAS FED PRESIDENT RICHARD FISHER, February 17
"I cannot foresee any circumstance at present that would lead me to support any further expansion of our initiative on that front," he said, referring to the Fed's current round of bond purchases. "As far as price stability ... we do have some pressures that are building."
CHICAGO FED PRESIDENT CHARLES EVANS, February 17
"I'm open-minded about the size of the current program ... It's quite likely we will continue with the 600 (billion dollars' worth). It will not surprise me if at the time we get to June and we are looking at the economy, that things are sufficiently better that that might be enough."
KANSAS CITY FED PRESIDENT THOMAS HOENIG, February 17
"We always tend to want to make sure everything is going very strongly before we begin to withdraw and I think that has its own consequences that we need to avoid."
MINUTES OF JAN. 25-26 FOMC meeting released February 16 "Participants generally expressed greater confidence that the economic recovery would be sustained."
CLEVELAND FED PRESIDENT SANDRA PIANALTO, February 15 "Unemployment rates have declined a bit recently, but job creation remains anemic, as businesses have been cautious in expanding their payrolls ... This recession was much deeper and lasted longer than previous recessions, and we have a long way to climb back."
* NEW YORK FED PRESIDENT WILLIAM DUDLEY, February 14
"The economy is healthier, but it is not yet well ... In order to reduce joblessness significantly over the coming quarters, the economy needs to grow at a considerably faster rate than we have seen so far in this recovery."
* PHILADELPHIA FED PRESIDENT CHARLES PLOSSER, February 11
Defending his decision in January to back the Fed's bond-buying program, of which he has been a critic: "Why do you want to signal something and then yank it out from under the market? That's just not a good way to conduct policy."
* FED BOARD GOVERNOR SARAH RASKIN, February 11
"The pace of recovery is agonizingly slow ... The critically important drag on the economy is the absence of any substantial recovery in the housing sector."
(Reporting by Kristina Cooke, Pedro Nicolaci da Costa, Mark Felsenthal, and Ann Saphir; Editing by Kenneth Barry)