Fed's Evans says 'QE' tapering is 'quite likely' by year-end

Fed's Evans says 'QE' tapering is 'quite likely' by year-end 

The Federal Reserve is "quickly likely" to begin to slow down the pace of its $85 billion a-month asset purchase program "starting later this year," said Charles Evans, the president of the Chicago Fed Bank, on Tuesday. The economic fundamentals "are actually really better" and growth in the second half of the year should accelerate to a 2.5% annual growth rate, he said. Evans said he could not predict exactly at which meeting the Fed would start to taper. "We need stronger evidence of accelerating growth, a little more momentum," he said. "We're not far from that," he added. Under his forecast, the Fed could wind down purchases "in a couple or few stages" and likely will end it when the unemployment rate falls to 7%, perhaps in the middle of 2014. "It is hard to forecast," he noted. Evans' remarks dovetail closely with comments last month by Fed Chairman Ben Bernanke that the Fed is likely to taper this year but is not on a preset course. Evans said that the Fed is likely to have purchased at least $1.2 trillion of assets by the time it ends this round of asset purchases, which would be twice the size of the preceding round. Evans is a voting member of the Fed's policy-making committee this year.