Federal Reserve Bank of St. Louis President James Bullard said the central bank should continue its bond buying because it’s the best available option for policy makers to boost growth that is slower than expected.

The purchases known as quantitative easing should be maintained because financial markets indicate that they are improving financial conditions and can be adjusted based on how the economy changes, Bullard, who votes on the policy-setting Federal Open Market Committee this year, said according to the text of remarks prepared for delivery in Frankfurt.

“Quantitative easing is closest to standard monetary policy, involves clear action and has been effective,” Bullard said. The panel should continue the program while “adjusting the rate of purchases appropriately in view of incoming data on both real economic performance and inflation.”

Fed officials are debating how and when to eventually curtail the purchases that have expanded the central bank’s balance sheet to a record $3.35 trillion. The FOMC said May 1 it will keep buying $85 billion in Treasurys and mortgage bonds per month to boost employment and spur the economy.

The FOMC said that it is prepared to accelerate or slow the monthly purchases of $40 billion a month in mortgage securities and $45 billion of Treasurys in response to changes in the labor market and inflation. It also left unchanged its statement that it plans to hold its target interest rate near zero as long as unemployment remains above 6.5 percent and the outlook for inflation doesn’t exceed 2.5 percent.

Payrolls Expanded

Payrolls expanded by 165,000 workers last month and the unemployment rate fell to a four-year low of 7.5 percent, Labor Department data show. Revisions added a total of 114,000 jobs to the employment count in February and March.

Quantitative easing is the best among five policy options that also include doing nothing, giving guidance about future actions, charging banks to hold reserves and swapping short-term debt for long-term bonds, Bullard said at the Institute for Monetary and Financial Stability.

The world’s largest economy expanded at a 2.5 percent annualized rate in the first quarter, the Commerce Department said last month. The gain followed a 0.4 percent fourth-quarter advance, the slowest since the first quarter of 2011.

Chairman Bernanke

Chairman Ben S. Bernanke tomorrow may provide clues as to whether he sees the Fed making enough progress toward its goal of a substantial improvement in the labor market when he testifies on the economic outlook before the Joint Economic Committee of Congress. The same day, the Fed is scheduled to release minutes from the April 30-May 1 FOMC meeting.

Officials last week expressed a range of views on when to begin winding down their purchases. Philadelphia Fed President Charles Plosser called for shrinking purchases at the Fed’s next meeting; San Francisco’s John Williams favored a reduction “perhaps as early as this summer,” and Boston’s Eric Rosengren said low inflation and high unemployment suggest there may be a need for more stimulus, not less.

Bullard, 52, joined the St. Louis Fed’s research department in 1990 and became president of the regional bank in 2008. His district includes Arkansas and parts of Illinois, Indiana, Kentucky, Mississippi, Missouri and Tennessee.