REFILE-Senior U.S. House Republican opposes Fed easing plan

(Refiles to add dropped word in first para)

WASHINGTON, Nov 7 (BestGrowthStock) – The Federal Reserve’s plan to
boost U.S. economic growth with $600 billion in bond purchases
is a mistake that will trigger inflation, a leading Republican
in the House of Representatives said on Sunday.

Representative Paul Ryan, expected to become chairman of
the House budget committee when Republicans take control of the
chamber in January, told the “Fox News Sunday” program that the
“upsides are very low” in the central bank’s moves to inject
more money into the U.S. economy.

“I think its going to give us a big inflation problem down
the road,” Ryan said.

The Fed launched a fresh round of so-called quantitative
easing last week, saying it will purchase $600 billion in U.S.
government securities. The U.S. stock market, which had been
rising on expectations of the move, welcomed the move with
further gains.

Ryan said the Fed should stick to its main job of ensuring
price stability, adding that the Fed’s plan was “destabilizing”
investment outlooks.

Fed Chairman Ben Bernanke on Saturday defended the central
bank’s action, saying the bond purchases would help the economy
and not jump-start inflation.

The U.S. central bank is an independent part of government
and does not take orders from Congress or the president.

During the financial crisis the Fed pushed the key Federal
Funds rate near zero and bought some $1.7 trillion in
government and mortgage bonds to stabilize the economy and
return it to growth.

But U.S. growth has been subpar the last six months,
prompting the Fed to act further to stimulate growth.

But some economists are concerned about inflation and some
U.S. trading partners have criticized it because the move has
helped weaken the value of the dollar, making U.S. goods
cheaper.
(Reporting by Donna Smith; Editing by Philip Barbara)

REFILE-Senior U.S. House Republican opposes Fed easing plan