Fed may buy other assets, Williams says

WASHINGTON (MarketWatch)
The Federal Reserve could expand its bond-buying program beyond mortgage-backed securities if necessary to get the economy moving, John Williams, the president of the San Francisco Fed Bank, said Monday
In a speech at the City Club of San Francisco, Williams said the QE3 would serve as a kind of automatic stabilizer, with the Fed either increasing or cutting back the purchases depending on economic conditions
Williams said the Fed remained committed to low inflation even though it has launched QE3 Opponents of the bond buys inside and outside the Fed have expressed concern that higher inflation may now be in store as a result of the program
Williams forecast that inflation would remain slightly below 2% for the new few years
Williams was a strong supporter of the QE3 program -- open-ended purchases of $40 billion per month of mortgage-backed securities
He said the purchases should give a "shot in the arm" to the housing market's recovery at just the right time