Various regional Fed governors spoke for the first time since the Fed decision to start QE-3. As could have been expected, the speakers are still to the camp of the proponents and the opponents they were in before the FOMC decision. So, Fed’s Lacker, who voted against the decision, explained why - he warned that inflation consequences of QE-3 could be devastating. The credit crisis shock may impede central bank efforts to bring quickly down unemployment even with the use of record stimulus. Also non-voter Fisher said he opposes the bold action.
The more centrist governor Bullard said he would have voted against for reasons of timing. It was too early to take such an action. He preferred the FOPMC would have waited for more evidence before deciding. He did welcome the open-ended nature of the programme though. Finally, Fed governors Dudley and Evans, doves, defended the FOMC decision. The declarations had little market impact, as investors know that the pro-active dovish camp inside the FOMC has a large majority.