Fed's Lockhart says "premature" to discuss stimulus pullback

STONE MOUNTAIN, Georgia Wed Apr 10, 2013 8:55am EDT

Dennis Lockhart, President, Federal Reserve Bank of Atlanta, and Charles Evans (L), President and CEO, Federal Reserve Bank of Chicago, take part in a panel discussion titled ''Twist and Shout: The Limits of U.S. Monetary Policy'' at the Milken Institute Global Conference in Beverly Hills, California May 1, 2012. REUTERS/Danny Moloshok

Dennis Lockhart, President, Federal Reserve Bank of Atlanta, and Charles Evans (L), President and CEO, Federal Reserve Bank of Chicago, take part in a panel discussion titled ''Twist and Shout: The Limits of U.S. Monetary Policy'' at the Milken Institute Global Conference in Beverly Hills, California May 1, 2012.

Credit: Reuters/Danny Moloshok

STONE MOUNTAIN, Georgia (Reuters) - It is too soon for the Federal Reserve to begin considering a tapering or halt of its bond-buying stimulus program, Atlanta Fed President Dennis Lockhart said on Wednesday.

"A lot of focus on that at the moment is maybe a bit premature," Lockhart told reporters during a press briefing on the sidelines of an Atlanta Fed conference. "We have to wait and watch how the data come in and see how the economy evolves."

Lockhart, who has said he sees the U.S. economy expanding between 2 percent and 2.5 percent this year, said he was disappointed by a weak reading on the jobs market for March. However, he added that it was important not to read too much into a single month's worth of data.

He said conditions could develop by the end of this year or in early 2014 that would allow the central bank to take its foot of the gas.

The U.S. economy generated just 88,000 jobs last month but that followed several months of solid gains.

The jobless rate fell to 7.6 percent in March from 7.7, but that reflected a large number of discouraged workers who stopped looking for work.

Lockhart said the trend of weak labor force participation, now at its lowest level in over three decades, was worrisome.

U.S. economic growth slowed to a crawl at the end of last year, but appears to have rebounded sharply in the first quarter.

Still, tighter budget policy in Washington leaves open the possibility that the expansion may not remain strong enough to bring about the substantial improvement in the labor market outlook that Fed officials seek.

In response to the financial crisis and deep recession of 2007-2009, the Fed cut official borrowing costs down to effectively zero and bought over $2.5 trillion in mortgage and Treasury securities to support the recovery.

(Editing by Chizu Nomiyama and Theodore d'Afflisio)

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