Kaplan says Fed should start tapering asset purchases in October

One of the highest-ranking officials at the US central bank made the case on Wednesday for the Federal Reserve to start 'tapering' its asset purchases from October.

The head of the Federal Reserve Bank of Dallas, Robert Kaplan, emphasised that while such purchases were great at stimulating demand, the current problems in the US economy had to do with supply.

In an interview with CNBC, Kaplan said: "It would be my view that if the economy unfolds between now and our September meeting [...] if it unfolds the way I expect, I would be in favor of announcing a plan at the September meeting and beginning tapering in October."

He also argued that by doing so the Fed could avoid having to take more "aggressive" action further down the road.

Kaplan was not a vote-wielding member of the Federal Open Market Committee in 2021.