Fed's Dudley: Strong forces holding back growth

WASHINGTON (MarketWatch)
Strong headwinds are preventing a more vigorous recovery and the Federal Reserve is considering a range of tools that much boost growth, said William Dudley, the president of the New York Fed Bank, on Monday. I
n a speech at Fordham University, Dudley called the economy's performance this year a "major disappointment." Dudley did not provide any clues about what tools he would support.
Some top Fed officials are pushing for a new round of purchases of mortgage-backed securities.
Others are focused on giving clearer guidance of what factors support the Fed's view that short-term rates can stay at zero until mid-2013.
Dudley said Fed policy was not "all-powerful" and needed complementary fiscal and housing policies. Dudley also said he expects inflation to slow down in coming quarters.