U.S. Fed chief says appropriate to consider wrapping up taper a few months sooner

WASHINGTON, Nov. 30 (Xinhua) -- U.S. Federal Reserve Chairman Jerome Powell said on Tuesday that it is appropriate to consider wrapping up the central bank's taper of asset purchases "a few months sooner" amid inflation pressures.

"The economy is very strong and inflationary pressures are higher, and it is therefore appropriate in my view to consider wrapping up the taper of our asset purchases ... perhaps a few months sooner," Powell told lawmakers at a hearing before the Senate Banking Committee.

"I expect that we will discuss that at our upcoming meeting," he said, referring to the Fed's policy meeting on Dec. 14-15.

The Fed began this month to reduce its monthly asset purchase program of 120 billion U.S. dollars by 15 billion dollars. At this pace, the Fed would end its asset purchases by June next year.

While Fed officials generally supported the plan to reduce asset purchases by 15 billion dollars a month, some Fed officials wanted a faster pace to give the central bank leeway to raise rates sooner, according to the minutes of the Fed's November policy meeting released last week.

Fed governor Christopher Waller has recently urged the central bank to speed up the pace of tapering asset purchases in response to the surging inflation.

"The rapid improvement in the labor market and the deteriorating inflation data have pushed me towards favoring a faster pace of tapering and a more rapid removal of accommodation in 2022," Waller said.

The consumer price index (CPI) rose 6.2 percent in October from a year earlier, the strongest annual gain in over 30 years, according to the U.S. Labor Department.

Powell also said that the recent rise in COVID-19 cases and the emergence of the Omicron variant pose downside risks to U.S. employment and economic activity and increased uncertainty for inflation.

"Greater concerns about the virus could reduce people's willingness to work in person, which would slow progress in the labor market and intensify supply-chain disruptions," he said.