Two former top officials at the Federal Reserve conditionally endorsed a further round of bond buying by the U.S. central bank to spur a flagging economic recovery, the Wall Street Journal said on Wednesday.

Former Fed Vice Chairman Donald Kohn and former Fed Monetary Affairs Director Brian Madigan said the Fed should consider a third round of bond purchases "only if inflation slows from recent elevated levels and if the economy continues to underperform," the newspaper reported in an article posted to its Web site.

Kohn said the Fed has limited options to support the economy. He said he expected the Fed to wait and see whether the economy is really losing steam before taking any action.

If that is the case and inflation is coming down, the former official said he would give "very serious consideration" to a new round of bond purchases, the Journal said.

Traders said buyers came into the stock market after Kohn's comments.

The Fed ended its second installment of long-term asset purchases, worth $600 billion, on June 30.

"Purchases of that order of magnitude could be helpful at the margin," Madigan is quoted as saying.

Kohn and Madigan couldn't immediately be reached for comment.

The Fed's policy-setting Federal Open Market Committee meets on Aug. 9. Fed Chairman Ben Bernanke said in mid-July the Fed would consider a range of steps to boost a weak recovery, including bolstering a low rates promise and bond buying, but wasn't ready to do so just yet.

Since then, economic data have pointed to economic growth falling short of the expectations of many forecasters, including those at the Fed, giving rise to speculation the economy may be at risk of sliding into recession.

Kohn, Madigan, and another former senior official at the Fed, Vincent Reinhart, put the risk of a new economic contraction at between 20 percent and 40 percent.