US Fed flexible on economic remedies

ATLANTA - The US economy may not need further help from the Federal Reserve (Fed) when its $600 billion stimulus plan runs out in June, but that decision will hinge on the path of the economy, a top Fed official said on Wednesday.

Atlanta Fed President Dennis Lockhart sounded skeptical about recent improvements in the economy, saying housing still posed a significant downside risk to growth and urging policymakers to stamp out even the smallest risk of deflation.

But asked about whether the Fed would have to extend its bond purchases or quantitative easing into a third round, a prospect referred to on Wall Street as QE3, Lockhart told reporters it might not have to.