Fed's George backs start of tapering

A top US central bank official called for the Federal Reserve to start tapering its asset purchase programme.

In remarks prepared for a speech, the head of the Federal Reserve Bank of Kansas City, Esther George, said that while "special factors" were still at play, expectations of continued strong demand, a recovering labor market, and firm inflation expectations were "consistent" with the Fed’s guidance regarding "substantial further progress toward its objectives" being made before beginning to 'taper' them.

"As witnessed during the last expansion, it can take some time to draw individuals back into the labor market," she added.

"This is not an argument for keeping rates unchanged but ensuring accommodation adjusts as the economy expands, avoiding imbalances and instability that can derail such gains."