Federal Reserve policy makers are laying the groundwork for further action at this month's meeting, warning that U.S. economic growth could stall, producing lasting stagnation in the job market.

Federal Reserve Bank of Chicago President Charles Evans said the Fed should consider adding "very significant amounts of policy accommodation" and attacked the notion that it should abide by a 2 percent ceiling on inflation. San Francisco Fed President John Williams cited "a number of steps" that could be taken to support growth, without offering specifics.

The Fed may decide at its Sept. 20-21 meeting to replace some of the short-term Treasury securities in its $1.65 trillion portfolio with long-term debt in a bid to lower rates on everything from mortgages to car loans, according to economists at Wells Fargo & Co., Barclays Capital Inc. and Goldman Sachs Group Inc. Some analysts dub the maneuver "Operation Twist" because it would bend long-term yields lower. Fed Chairman Ben S. Bernanke is due to speak in Minnesota today on the economic outlook at 1:30 p.m. New York time.

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