Talk of trimming QE 'exactly the wrong message' -Fed's Kocherlakota

Reuters

BUTTE, Montana, Oct 17 (Reuters) - A top Federal Reserveofficial on Thursday took another swipe at his more hawkishcolleagues, warning against public discussion of reducing theU.S. central bank's bond-buying stimulus.

"Talking about reducing stimulus right now because we are... sufficiently satisfied with where we are in the labor marketoutlook ... I think that sends exactly the wrong message,"Minneapolis Fed President Narayana Kocherlakota said after aspeech in Butte, Montana.

The Fed's policy-setting Federal Open Market Committee, orFOMC, he added, "does not give the whatever-it-takes mentalitythat ... I think we should be conveying to people."

Addressing this week's near U.S. government default,Kocherlakota, who does not have a vote on the FOMC this year,said the quicker politicians get their fiscal house "in order"the more that longer-term inflation expectations will beanchored, and the better ultimately for monetary policy.

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