U.S. on firmer footing than in past several years -Fed's Plosser

PHILADELPHIA Tue Jan 14, 2014 12:45pm EST

Related Topics

PHILADELPHIA Jan 14 (Reuters) - Predicting more economic growth and a further drop in U.S. unemployment this year, a top U.S. central banker said on Tuesday he would prefer a quicker-than-planned withdrawal of policy stimulus.

Philadelphia Fed President Charles Plosser, whose hawkish views are well known at the Federal Reserve, downplayed a weak December jobs report and rebuffed concerns some of his colleagues have voiced over so many Americans having dropped out of the work force.

"As we enter 2014, I think the bottom line is that the economy is on a firmer footing than it has been for the past several years," he was to tell a luncheon at the ornate Union League of Philadelphia building in downtown Philadelphia.

According to prepared remarks, Plosser - who votes on U.S. monetary policy this year under a rotating system - predicted joblessness would fall to 6.2 percent by year end, from 6.7 percent last month.

He repeated expectations that inflation, while low at 1 percent now, will rise toward the Fed's 2-percent goal through the year, and he reiterated a forecast of 3-percent gross domestic product growth.

While the Fed this month trimmed its bond-buying to $75 billion per month from $85 billion, in a nod to a better labor market, Fed Chairman Ben Bernanke has said the program would be wound down in cautious, measured steps and probably shelved altogether by year end.

"My preference would be that we conclude the purchases sooner than this," Plosser said, "but I am glad that we have taken the first step on the path to ending the program."

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.