CHARLOTTE May 13 Richmond Federal Reserve
President Jeffrey Lacker said on Tuesday that he favors a
narrower, more restrained role for the U.S. central bank.
Lacker said the Fed's ambitious use of balance sheet as a
way to channel credit to particular economic sectors threatens
to entangle the Fed in politics and puts the bank's independence
"Moreover, the use of central bank credit to rescue
creditors boosts moral hazard and encourages vulnerability to
financial shock," Lacker said at the annual Credit Markets
Symposium held at the Fed's Charlotte branch.
Lacker did not comment on the outlook for the U.S. economy
or monetary policy in his opening remarks.
(Reporting by Michael Flaherty; Editing by James Dalgleish)