Federal Reserve May Trigger New Bubble with Bond Buys

Kansas City Reserve head uncomfortable with current actions

The Federal Reserve may be contributing to the next asset price bubble through its aggressive purchase of bonds to spur U.S. growth, while its near-zero interest rates could trigger future inflation, a senior Fed official said on Thursday.

Kansas City Federal Reserve President Esther George, in remarks that will clearly stamp her as a hawk on the U.S. central bank's policy-setting committee, went out of her way to make clear that she is not comfortable with recent Fed action.