The federal funds rate target will “remain exceptionally low — that is, at the current level — at least through late 2014,” Federal Reserve Bank of New York president William Dudley said Thursday.

When “progress toward the mandate objectives is slower than desired, monetary policy needs to be kept at a more accommodative setting for a longer time period than a standard rule would suggest,” he told the Council on Foreign Relations, according to a prepared text of remarks released by the Fed.

With the current expectations “of stable prices and a still slow path back to full employment, there is an argument for easing further,” but since the Fed fund target is near zero, costs must be weighed before moving. In his opinion, benefits “are unlikely” to exceed costs.

Dudley said he would “consider tightening policy at a somewhat earlier stage if growth strengthened sufficiently to materially improve the medium-term outlook and substantially reduce tail risks, or if there was evidence of a genuine threat to medium-term inflation, including a rise in inflation expectations.”

The first move toward tightening would be to alter the forward guidance of exceptionally low rates through 2014.

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