Bernanke says Fed's tapering of 'QE' is not on a 'preset' course

Bernanke says Fed's tapering of 'QE' is not on a 'preset' course

The Federal Reserve's proposed timetable for tapering its bond-buying program is not set in stone, said Federal Reserve Chairman Ben Bernanke on Wednesday. "I emphasize that, because our asset purchases depend on economic and financial developments, they are by no means on a preset course," Bernanke said in remarks prepared for delivery to the House Financial Services Committee. Bernanke repeated his guidance from mid-June that the Fed anticipates it will be appropriate to begin to moderate the pace of purchases "later this year," and end them "around midyear." The Fed chairman said the central bank would react to developments. If economic conditions were to improve faster that expected, the pace of asset purchases could be reduced "somewhat more quickly." But if the outlook were to become relatively less favorable, or if financial conditions were seen as too tight, "the current pace of purchases could be maintained for longer," Bernanke said. The chairman's prepared remarks were fairly dovish. He said the economy remained vulnerable to shocks and there was a risk that a dispute in Congress over the debt ceiling could hamper the recovery