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Federal reserve seen launching fresh stimulus, details in question

Published on Sep 13, 2012 1:03 PM

WASHINGTON (REUTERS) - The United States (US) Federal Reserve appears set to launch a third round of unconventional monetary stimulus on Thursday while signaling that a weak US economy may warrant ultra-low interest rates for at least another three years.

Not everyone believes the Fed will embark on another bond-buying spree, and plenty of doubts remain about the likely efficacy of such a move.

But Fed Chairman Ben Bernanke has made clear the central bank will not sit idly by while unemployment, currently at 8.1 per cent, remains so far above levels consistent with a healthy economic recovery.

Many economists are confident the Fed's policy-setting Federal Open Market Committee (FOMC) will deliver a third round of quantitative easing, or QE3. On median, they see a 60 per cent chance, according to a Reuters poll.

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