October 19, 2010 / 12:44 PM / 8 years ago

Fed's Lockhart: Quantitative easing must be big

WASHINGTON (Reuters) - Atlanta Federal Reserve Bank President Dennis Lockhart said on Tuesday that further easing by the Fed has to be large enough to help boost demand, and purchases of $100 billion of securities a month would be a possibility.

CEO of the Federal Reserve Bank in Atlanta Dennis Lockhart listens during a presentation at the American Economic Association Conference in Atlanta, Georgia in this January 4, 2010 file photo. REUTERS/Tami Chappell

“If we’re going to pursue another round of quantitative easing, it has to be a large enough number to make a difference,” Lockhart said in an interview on CNBC.

“As a monthly number ($100 billion) is fairly consistent with what we did before, and so I think it would certainly be in the range of numbers one might consider ... but if you were talking about $100 billion as simply the overall program, I think that’s too small,” he said.

Most analysts expect the Fed to announce another round of large-scale asset purchases at its next policy meeting scheduled for November 2-3, and expect buying of around $500 billion overall.

Lockhart said he is leaning toward providing further help to the weak recovery.

“I think the risks associated with it are acceptable,” he said. “Quantitative easing will help improve a recovery that is going very slowly and improve the trajectory of the economy overall.”

Reporting by Mark Felsenthal, Editing by Chizu Nomiyama

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