April 7, 2017 / 5:04 PM / in 4 months

Fed might avoid simultaneous rate hike, bond runoff -Dudley

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NEW YORK, April 7 (Reuters) - The Federal Reserve might in the future avoid raising interest rates at the same time that it begins the process of shrinking its $4.5 trillion bond portfolio, prompting only a "little pause" in the central bank's rate hike plans, an influential Fed official said on Friday.

"Presumably, at the time that you make the decision on the balance sheet you might want to forego the decision on short-term rates just to make sure that the balance sheet doesn't turn out to be a bigger decision than you thought you were making," New York Fed President William Dudley said at a luncheon. (Reporting by Jonathan Spicer; Editing by Meredith Mazzilli)

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