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Lacker Says Markets to Stay Volatile as Fed Debates Tapering

Federal Reserve Bank of Richmond President Jeffrey Lacker, who dissented against additional stimulus at every Fed meeting last year, predicted financial markets will remain volatile as policy makers debate how and when to curtail the central bank’s asset purchases.

“As market participants gain additional insight from the words of Federal Reserve officials or by policy actions in coming quarters, further asset price volatility seems likely,” Lacker, who doesn’t vote on policy this year, said in a speech today in White Sulphur Springs, West Virginia. “This type of volatility is a normal part of the process of incorporating new information into financial asset prices.”