(Updates with labor market forecast in seventh paragraph.)
Dec. 5 (Bloomberg) -- Federal Reserve Bank of Atlanta President Dennis Lockhart, a backer of record stimulus, said any decision to taper bond purchases should be accompanied by a limit on the size of the program or a timetable for ending it.
"If and when the FOMC arrives at a decision to wind down asset purchases, it’s my view that it will be helpful to the transition process to provide as much certainty as possible about how this will be done," said Lockhart, referring to the Federal Open Market Committee, in a speech in Fort Lauderdale, Florida. He doesn’t vote on policy this year.
The FOMC will consider scaling back $85 billion in monthly bond buying in coming months based on expected gains in the labor market, according to minutes from the committee’s October meeting. The panel is scheduled to meet Dec. 17-18.
The U.S. economy probably added 185,000 jobs last month, and the unemployment rate fell to 7.2 percent from 7.3 percent, according to median estimates in a Bloomberg survey of economists before a government report tomorrow.
Lockhart said he is among FOMC participants who favor announcing a "total size of remaining purchases or a timetable for winding down the program." He spoke to Broward Workshop, a local business group.
"I am among those who see merit in this approach as long as the economy follows roughly the path we expect," he said. "Once the decision is made, I favor providing the public as much clarity and certainty as possible about how the change will be executed."
Lockhart predicted the labor market will improve, with inflation rising toward the Fed’s target. "My outlook for 2014 calls for some firming in economic activity," he said.
The economy expanded at a "modest to moderate" pace from early October through mid-November, the central bank said yesterday in a survey of regional economic conditions.
"I now think it is appropriate in coming meetings to put a tapering decision on the table as long as the resulting overall posture of policy preserves a high degree of accommodation," Lockhart said.
A former Georgetown University professor, Lockhart has led the Atlanta Fed since 2007. His district includes Alabama, Florida, Georgia, and portions of Louisiana, Mississippi, and Tennessee.
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