Fed's Raskin says more easing may be needed (by Steve Goldstein)
WASHINGTON (MarketWatch) -- Further Federal Reserve actions might be warranted even though the central bank's unusual steps such as bond buying and last week's announced maturity shift plan have made a "somewhat more muted" than expected transmission to economic growth and employment, said Fed Governor Sarah Bloom Raskin at a University of Maryland event on Monday. "Even if the usual effectiveness of monetary policy is being attenuated by the factors that I have mentioned, that conclusion should not be taken as implying that additional monetary accommodation would be unhelpful. Indeed, the opposite conclusion might well be the case--namely, that additional policy accommodation is warranted under present circumstances," said Raskin, one of seven FOMC members who voted for last week's decision. She added that since the Fed said principal payments from agency security holdings will be reinvested in agency mortgage-backed securities rather than Treasurys, the spread between agency MBS and Treasury securities of similar maturity has narrowed, reversing a widening from earlier this year.