BUTTE, Montana (Reuters) – A top Federal Reserve official on Thursday took another swipe at his more hawkish colleagues, warning against public discussion of reducing the U.S. central bank’s bond-buying stimulus.
“Talking about reducing stimulus right now because we are … sufficiently satisfied with where we are in the labour market outlook … I think that sends exactly the wrong message,” Minneapolis Fed President Narayana Kocherlakota said after a speech in Butte, Montana.
The Fed’s policy-setting Federal Open Market Committee, or FOMC, he added, “does not give the whatever-it-takes mentality that … I think we should be conveying to people.”
Addressing this week’s near U.S. government default, Kocherlakota, who does not have a vote on the FOMC this year, said the quicker politicians get their fiscal house “in order” the more that longer-term inflation expectations will be anchored, and the better ultimately for monetary policy.
(Reporting by David Nolt; Writing by Jonathan Spicer; Editing by James Dalgleish)
Talk of trimming QE 'exactly the wrong message' - Fed's Kocherlakota
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