The unemployment rate decline "overstates" the improvement in the jobs sector and the economy's "forward momentum" has yet to show enough strength to indicate it can support job growth, so the time is not right for the Fed to taper, Federal Reserve Bank of New York President and Chief Executive Officer William C. Dudley said Monday.

"To begin to taper, I have two tests that must be passed: (1) evidence that the labor market has shown improvement, and (2) information about the economy's forward momentum that makes me confident that labor market improvement will continue in the future," Dudley said in a speech at Fordham University, according to prepared text released by the Fed. "So far, I think we have made progress with respect to these metrics, but have not yet achieved success."

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