WASHINGTON -- Federal Reserve Board Chairman Alan Greenspan yesterday endorsed issuing government bonds indexed to inflation to provide Fed officials with another tool for conducting monetary policy.

Appearing before the House Government Operations subcommittee on monetary affairs, Mr. Greenspan cautioned that it might take several years before the U.S. Treasury can issue inflation-indexed bonds. He added that the Treasury would have to proceed cautiously to make sure any new issues do not disrupt federal financing operations.

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