BERLIN, July 27 The U.S. central bank should
stop its bond-buying quickly and an end to the programme was "in
sight", a senior Federal Reserve official said in an interview
with a German magazine on Saturday.
Richmond Fed President Jeffrey Lacker, one of the Fed's most
fiscally conservative officials, said he expected ending the
process to be successful, according to WirtschaftsWoche.
"We must make our exit from the bond-buying programme
quick," Lacker was quoted as saying by the German magazine.
"An end to these bond purchases came into sight at the
latest Fed meeting," he said.
Fed Chairman Ben Bernanke jolted markets in late May by
saying the U.S. central bank planned to ease back on its
stimulus efforts once the economy improves.
Under the plan Bernanke laid out on June 19, the Fed is
likely to reduce its monthly bond buys later this year and halt
them altogether by mid-2014, as long as the economic recovery
unfolds as expected.
Lacker pointed to relatively low inflation and said a
faster-than-expected fall in the U.S. jobless rate was
sufficient to start winding down the purchasing programme.
"First of all we should end the monthly purchases of
mortgage bonds as quickly as possible," he said. The magazine
said Lacker hoped this would force the U.S. Congress to agree
more quickly on reducing debt.
"We need a sustainable solution and the sooner the better,"
Lacker said more needed to be done on drawing up rules to
avoid future government rescues for struggling banks and said
the stress tests conducted in the United States were a step in
the right direction.