The benefits of the Fed's asset purchases still exceed the costs, Federal Reserve Bank of New York President and Chief Executive Officer William C. Dudley, reiterated Tuesday.
The benefits of the purchases are "reflected in improving financial conditions and the quickening pace of interest-sensitive spending such as that on consumer durable goods, housing, and capital goods," he told the Staten Island Chamber of Commerce, according to prepared text released by the Fed.
"Furthermore, the labor market outlook has yet to show substantial improvement. Consequently, I see the current pace of asset purchases as appropriate," he said.
"At some point, I expect that I will see sufficient evidence of improved economic momentum to lead me to favor gradually dialing back the pace of asset purchases," Dudley continued. "Of course, any subsequent bad news could lead me to favor dialing them back up again."
He quoted Federal Reserve Board Chairman Ben Bernanke that when conditions show "meaningful" change, purchases can be adjusted "to keep the level of accommodation consistent with the outlook."
