A mid-2015 liftoff on interest rates seems "reasonable" to Federal Reserve Bank of New York President and Chief Executive Officer William C. Dudley, who said Tuesday he expects to back ending the Fed asset purchase program when the Federal Open Market Committee meets on Oct. 28-29.
"I expect to support a decision to end the asset purchase program at the end of this month," Dudley said according to prepared text of a speech released by the Fed. "At the same time, it still is premature to begin to raise interest rates-the labor market still has too much slack and the inflation rate is too low."
He noted the consensus for liftoff is mid-2015. "That seems like a reasonable view to me," he said, reminding, "But, again, it is just a forecast."
Economic news and how it impacts the outlook will ultimately determine the timing, with "firmer growth, higher inflation, and a more rapid tightening of the labor market" leading to an earlier liftoff and "should economic growth disappoint, the timing of lift-off could be pushed later."
