Fed's Rosengren urges patience in removing accommodation
Dec 20 (Reuters) - The U.S. central bank may have jumped the gun in deciding to reduce its bond-buying stimulus despite too-high unemployment and too-low inflation, a top Federal Reserve official who opposed the move said on Friday.
In comments posted on his website less than 48 hours after the decision, Boston Federal Reserve Bank President Eric Rosengren said he expects the U.S. economy to continue to strengthen and for growth to be close to 3 percent next year.
But, he said, "I do not yet have sufficient confidence in this outlook to risk the removal of any monetary accommodation at this time."
The Fed on Wednesday began dialing down an unprecedented era of easy money, saying the U.S. economy was finally strong enough for it to start to trim the pace of its monthly asset purchases, by $10 billion to $75 billion.
Fed Chairman Ben Bernanke suggested the program could be wound down completely before the end of 2014.
Rosengren cast the only dissenting vote on the Fed's policy-setting panel.
"I would prefer to wait until the economic improvement that I am forecasting is clearly evident in the data before reducing the size of the asset-purchase program," Rosengren said. "My decision to cast a dissenting vote was focused on counseling patience in removing monetary accommodation."
At the same time the Fed tempered the long-awaited move with assurances that short-term interest rates would stay at rock bottom even longer than previously promised.
Rosengren said Friday he strongly supports the new forward guidance on low rates.
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