A top U.S. central banker on Monday cautiously endorsed further cuts to a stimulative bond-buying program, warning the labor market has not yet healed and that there are worrisome signs of disinflation in the economy.
Dennis Lockhart, president of the Federal Reserve Bank of Atlanta, also suggested the central bank should clarify its future plans for raising interest rates now that U.S. unemployment has dropped to 6.7 percent – close to the Fed’s stated threshold of 6.5 percent for considering tighter policy.
In a speech on what 2014 may hold for the economy, he said “very accommodative” monetary policy remains appropriate despite his predictions for a pick-up in economic growth and a gradual rise in inflation this year.
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