Fed may need to buy more mortgage bonds-Williams via Reuters

The U.S. central bank may need to buy more bonds to bolster a housing market whose distress is at the heart of a weak economic recovery, a top Federal Reserve official said on Wednesday.

"Looking ahead, we may still need to provide more policy accommodation if the economy loses momentum or inflation remains well below 2 percent," San Francisco Fed President John Williams said in remarks prepared for delivery to the Bishop Ranch Forum in the San Francisco suburb. "Should that occur, restarting our program of purchasing mortgage-backed securities would likely be the best way to provide a boost to the economy."

Williams is the second regional Fed president inside of a week to make the case for more monetary policy accommodation through the purchase of more mortgage-backed securities. Chicago Fed President Charles Evans last Thursday said he would be "aggressive" in seeking more help for the economy through the purchase of such bonds.

Read more...Fed may need to buy more mortgage bonds-Williams via Reuters