Fed's Dudley would be surprised if QE2 uncompleted

It would be a surprise if the U.S. Federal Reserve did not complete its $600 billion in bond purchases, though the benefits of doing more have fallen, a top Fed official said on Friday.

I would be surprised if we didn't finish the full QE2, New York Federal Reserve Bank President William Dudley said in response to reporters' questions in San Juan, Puerto Rico.

QE2 is a market acronym for the Fed's bond purchase program, which is the second round of Fed quantitative easing.

The benefits of further QE have diminished a bit because the risk of deflation, which was one of the primary motivators of QE2, has diminished considerably, Dudley said.

Dudley said the Fed has the tools to eventually reverse course, but it is too early to talk about the specifics of what tools it will use and in what order.

The president of the New York Fed has a permanent voting seat on the Fed's policy-setting panel. His recent views have been dovish on inflation.

(Reporting by Kristina Cooke)