September 30, 2009 / 2:02 PM / 10 years ago

Fed's Lockhart says too early to rush for exits

MOBILE, Ala., Sept 30 (Reuters) - The U.S. economy is embarking on a tentative recovery and it is too early to embark on a full-on exit from the Federal Reserve’s accommodative policies, Atlanta Federal Reserve Bank President Dennis Lockhart said on Wednesday.

Lockhart, in remarks prepared for a speech in Mobile, Alabama, said he wanted to see more evidence that the private sector can thrive without government support.

“I do not think that time has yet come, and to be consistent with my outlook, I think it may well be some time before a comprehensive exit need be under way,” Lockhart said.

“We all ardently want to believe the nation is on the economic comeback trail. I don’t think we are served by declaring prematurely that we’re in the clear.”

Concerns that expansion of the Fed’s balance sheet to back its unorthodox policies would trigger high inflation at some point were “exaggerated,” he said.

Lockhart is a voting member of the Federal Open Market Committee this year.

Reporting by Ros Krasny, Editing by Chizu Nomiyama

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