Fed should begin to wean markets off QE3 this year: Plosser

STANFORD, California Tue Feb 12, 2013 9:55pm EST

STANFORD, California (Reuters) - The U.S. unemployment rate will probably fall quickly enough for the Federal Reserve to start trimming its asset purchases before the end of 2013, a top Fed policymaker said on Tuesday.

"If my forecast is right and we are close to 7 percent unemployment rate near the end of this year, then I think we should at least to have begun backing off from our asset purchases if unemployment is declining at that pace," Charles Plosser, president of the Philadelphia Fed, told reporters after a speech here.

"I think we would start tapering in some way and gradually sort of wean the markets and us off the purchases to sort of wind them down," Plosser said

Unemployment is 7.9 percent currently. The Fed's current round of asset purchases is known as QE3, because it is the U.S. central bank's third round of quantitative easing.

(Reporting by Ann Saphir; Editing by Leslie Adler)

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