Fed's Lockhart (moderate, FOMC alternate): Expects first raise in main rate in H2 2015; Expects Fed to halt QE in Q4 2014; Sees 3% GDP growth over next several quarters Policy
- Reiterates expects Fed to halt QE in Q4 2014
- No strong view on exact end date for Taper.
- Expects first raise in main rate in H2 2015; Reiterates 6 months from QE end to rate hike too short
- Sees growth rebound, no rush to raise rates.
- Has not yet achieved inflation, employment goals. - Discussion of policy normalization does not imply imminent shift.
- Transition to rate hikes will need careful execution and clear communication.
- Fed should continue reinvesting bond proceeds until Feb begins rates hike.
- Considers long-term Fed funds rate at around 4%.