KANSAS CITY, Mo., July 16 (Reuters) - The Federal Reserve should begin to reduce its massive bond-buying program and bring it to a close “sometime in the first half of next year,” a top Fed official said on Tuesday.
Should the U.S. economy grow faster than currently expected, Kansas City Fed President Esther George told an agricultural conference, it may be “appropriate” to reduce the bond-buying program at a faster pace.
The Fed is buying $85 billion in Treasuries and mortgage-backed securities every month to push down long-term borrowing costs and boost investment and hiring.
George has dissented at every meeting of the Fed’s policy-setting panel this year, saying she is concerned about continued aggressive monetary policy easing when the economy is growing. She expects the economy to grow about 2 percent this year, fueled by an improving jobs market and a housing recovery.
But the timeline she laid out on Tuesday was largely in line with that of Fed Chairman Ben Bernanke last month. Bernanke said the Fed may start reducing bond buys later this year and end them by mid-2014.