By Dow Jones Business News, October 15, 2013, 05:35:00 PM EDT
One of the loudest critics of the Federal Reserve's $85 billion-a-month bond-buying program said Tuesday it could be
hard for him to argue for reducing the program at the central bank's October policy meeting because of the budget
showdown in Washington.
Dallas Fed President Richard Fisher said in an interview with CNBC that he can't see himself making the argument to
scale back the program at the Oct. 29-30 meeting if the markets are still rattled or there still isn't a resolution to
the fiscal fight. Mr. Fisher is a nonvoting member of the policy-setting Federal Open Market Committee this year.
Mr. Fisher has been one of the staunchest opponents of the bond-buying program, known as quantitative easing, or QE.
He has said he argued in favor of the Fed making a small reduction in the pace of purchases at the Sept. 17-18 meeting.
Instead, the Fed chose to stand pat, in part because it feared the budget fight in Washington could escalate. That has
come to pass: The government has been partially shut down for the past two weeks and the U.S. Treasury Department says
it will no longer be able to borrow Thursday and will face a cash crunch in paying its bills.
"We don't want to upset the boat here. I don't want to upset the boat" on the "horribly rough seas" being produced by
Congress and the White House, said Mr. Fisher. He left himself some wiggle room, saying he would need to see how the
standoff is resolved and the terms of any budget deal before deciding what position to take at this month's FOMC
Not only has the fiscal showdown created a headwind for economic growth, it has also complicated the Fed's ability to
see how the economy is doing, Mr. Fisher said, referring to the fact that the shutdown has prevented government agencies
from producing a variety of economic data reports that the Fed uses.
"Here we are full throttle at the Fed, they've got the foot jammed on the break and they're smashing the instrument
panel at the same time, and we're in midflight," Mr. Fisher said.
Write to Victoria McGrane at firstname.lastname@example.org
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