By Chris Reese
NEW YORK (Reuters) - The Federal Reserve will buy a total of $600 billion of bonds under its newest stimulus program, known as QE3, and is likely to buy Treasuries outright after its "Operation Twist" stimulus ends in December, according to a Reuters poll of economists on Friday.
The forecasts from 43 economists for the ultimate size of the Fed's third round of quantitative easing ranged from $280 billion to $3 trillion.
The median of forecasts for the program size was unchanged from the median in a Reuters poll of 52 economists conducted on September 14, the day after QE3 was announced.
The Fed has said the program is open-ended and will continue until the outlook for the labor market improves "substantially."
Friday's poll was conducted after the government announced the U.S. unemployment rate unexpectedly fell to 7.8 percent in September, which was the lowest since January 2009.
The September payrolls report "is a movement in the right direction, but it is far too early to expect the Fed to change tack based on today's numbers," said Michael Hanson, senior economist at Bank of America Merrill Lynch in New York.
Within the poll, the median of forecasts from economists at 13 primary dealers -- the large financial institutions that do business directly with the Fed -- called for the ultimate size of QE3 to be $750 billion, which was also unchanged from the September 14 poll.
The median of forecasts from 38 of the economists in the broader poll was for the unemployment rate to fall to 7 percent before the central bank would consider ending QE3. Several economists emphasized, however, they did not think the Fed had a target unemployment level, saying the central bank will monitor overall labor conditions instead.
"The Fed is not targeting a certain level of unemployment rate. Given that QE3 is tied to their prospects for the labor market, they will stop the program when they forecast sustainable and substantial improvement in the labor market," said Lewis Alexander, chief U.S. economist at Nomura Securities International in New York.
Forty of 48 economists said the Fed will buy Treasuries after Operation Twist ends in December. Under Twist, the Fed is selling shorter-dated Treasuries and using the proceeds to buy longer-dated Treasuries in an effort to lower long-term borrowing costs like those on mortgages.
Currently, under QE3, the central bank is buying only mortgage-backed securities.
"The September (payrolls) report, by itself, is unlikely to affect the Fed's plans," said Dean Maki, chief economist at Barclays Capital in New York, adding "a further notable drop over the next two months could affect the decision on converting Operation Twist to an outright Treasury purchase plan in December."
In two prior rounds of quantitative easing, the Fed bought $2.3 trillion in mortgage and government debt.
(Additional reporting by Ashrith Rao Doddi and Snehasish Das in Bangalore and Pam Niimi in New York; editing by Andrew Hay)