UPDATE 1-Fed minutes: Easing may be needed "before long"

* Fed focuses on Treasury buys, communications strategy

* Price-level targeting and GDP targeting discussed

* Many members disappointed on economy’s progress
(Adds background, details)

WASHINGTON, Oct 12 (BestGrowthStock) – U.S. Federal Reserve
officials believed in September the struggling recovery might
soon need more help, and they discussed several ways to provide
support, including the possible adoption of a price-level
target.

Policy-makers had a “sense that (more) accommodation may be
appropriate before long,” the central bank said on Tuesday.

In minutes of the its last policy-setting session held
Sept. 21, the Fed said officials discussed several approaches
to aiding the economy but focused on buying additional
longer-term Treasury securities and ways to nudge the public
into expecting higher levels of inflation in the future.

On Wall Street, stocks trimmed their losses, with both the
Dow Jones industrial average (.DJI: ) and the Standard & Poor’s
500 Index (.SPX: ) briefly turning higher after the FOMC’s
minutes came out.

To help shift inflation expectations, policy-makers debated
providing more detailed information about what rates of
inflation they would prefer, or the possibility of making clear
they would tolerate a higher level of inflation on a temporary
basis, a policy approach known as price-level targeting.

They also discussed the possibility of targeting a path for
GDP growth.

The Fed has kept overnight interest rates near zero since
December 2008 and has bought about $1.7 trillion in
mortgage-linked securities and longer-term government debt to
lower other borrowing costs to help the economy recover from
the worst recession since the 1930s.

As the recovery showed signs of fading over the summer,
sapped by the drying up of government stimulus measures and the
shock of a sovereign debt crisis in Europe, Fed officials said
they would consider additional stimulus measures to support the
sluggish economy.

The September meeting’s minutes showed a number of Fed
officials were close to pulling the trigger.

“Many members considered the recent and anticipated
progress toward meeting the committee’s mandate of maximum
employment and price stability to be unsatisfactory,” the Fed
said.

Several officials felt that unless conditions improved,
they would consider it appropriate to take action soon in hopes
of spurring a stronger recovery.
(Reporting by Mark Felsenthal and Jason Lange; Editing by Jan
Paschal)

UPDATE 1-Fed minutes: Easing may be needed "before long"