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U.S. dealers expected $15 billion reduction in QE3 in September: survey

NEW YORK (Reuters) - Primary dealers surveyed before the Federal Reserve's July policy meeting said they expected the U.S. central bank to trim its asset purchases by $15 billion starting in September.

According to the survey conducted by the New York Fed, the median of responses showed that the dealers expected the U.S. central bank to keep buying $85 billion in bonds per month until a meeting scheduled for September 17-18.

At that meeting, they expected policymakers to trim Treasury buys by $10 billion and mortgage-bond buys by $5 billion.

The dealers predicted that by December, the Fed would reduce its quantitative easing program, known as QE3, by an additional $15 billion, bringing the total size of the program to $55 billion per month.

To spur investment and growth, the Fed now buys $45 billion in Treasury bonds and $40 billion in mortgage bonds per month.

The survey was done just before the Fed's July 30-31 meeting, at which monetary policymakers decided to continue their asset-buying apace.

A survey done before the previous Fed meeting, in June, showed dealers did not expect the first reduction in QE3 until December.

(Reporting by Jonathan Spicer; Editing by Gary Hill)