Fed should be standing pat now, Lacker says (by Greg Robb)

WASHINGTON (MarketWatch) - The Federal Reserve should not be purchasing more assets in the market as bank reserves are already large enough to support a strengthening recovery, said Jeffrey Lacker, the president of the Richmond Federal Reserve Bank, on Thursday. "In my view, the balance of considerations suggests that we should be standing pat now rather than easing policy further," Lacker said in a speech at the West Virginia Economic Outlook Conference in Charleston, W. Va. Lacker said the Fed had the tools to exit its ultra-easy policy when needed but "the larger our balance sheet when the time comes to withdraw monetary stimulus, the more difficult and risky that process will be," he said. Lacker has dissented at all Fed interest-rate setting committee meetings this year. He opposed the central bank's third round of bond buying, consisting of an open ended $40 billion per month of mortgage-backed securities.