4 Fed Bankers: No Need for QE3

In further proof that the days of presenting a united front at the Fed are gone, four central bankers said Tuesday that further stimulus, known as QE3, probably won’t be needed as an unexpected increase in U.S. manufacturing output increased optimism over the country’s economic strength.

John Williams, president of the San Francisco Fed, joined his counterparts from Richmond, Philadelphia and Atlanta in “casting doubt on the need for additional purchases of bonds to push down longer-term interest rates,” Bloomberg reports. Three of them are voting members of the rate-setting Federal Open Market Committee.

“Thresholds for further action ‘would be if we see economic growth slow to the point where we’re not seeing further progress in bringing the unemployment rate down,’ Williams said, or if inflation dropped “significantly” below the Fed’s 2% goal. Those aren’t “the circumstances I currently expect,” Williams said at a conference in Beverly Hills, Calif., according to the news service.