The president of the Federal Reserve Bank of Atlanta said central bank policy makers should move cautiously this fall in dialing back the central bank's stimulus.
Atlanta Fed chief Dennis Lockhart said the central bank could make its first reduction in its $85 billion-a-month bond buying program any time before the end of the year, but isn't locked into doing so following its September meeting, according to prepared remarks Tuesday.
He stressed that the initial reduction is only the beginning of the process and officials will make adjustments based on the latest economic data.
"A decision to proceed–whether it is in September, October, or December–ought to be thought of as a cautious first step," Mr. Lockhart said, according to the text of his speech to the Kiwanis Club of Atlanta.
With the unemployment rate falling to 7.4% last month, many economists expect the initial reduction in stimulus to occur next month.