Raising IOER rate the first step to tightening -Fed's Stein

BOSTON Fri Nov 30, 2012 6:27pm EST

BOSTON Nov 30 (Reuters) - A top Federal Reserve official said on Friday that the first stage to tightening monetary policy will be raising the interest rate that the U.S. central bank pays financial institutions to park their excess reserves there.

Fed Governor Jeremy Stein, speaking at a conference hosted by the Boston Fed, said raising the so-called interest on excess reserves (IOER) rate would be a straight-forward process, when the time is right. For now, the Fed's policy is very accommodative.

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