Federal Reserve Gov. Christopher Waller said the better-than-expected performance of the U.S. economy warrants scaling back asset purchases sooner than expected and he favors starting with mortgage-backed securities.

“We are now in a different phase of economic policy so it is appropriate to start thinking about pulling back on some of the stimulus,” Waller said in a Bloomberg TV interview on Tuesday. “I am much more sympathetic to tapering MBS first.”

The Fed held interest rates near zero at its June 15-16 meeting and signaled it would probably keep them there until 2023 to help the U.S. economy recover from COVID-19. Officials also pledged to keep buying $120 billion of Treasuries and mortgage-backed securities a month until “substantial further progress” had been made on employment and inflation goals.

“This year has been a surprise. None of us back in December would have thought the economy would be where it is right now,” Waller said. “Given the way the economy has progressed, I think everybody anticipates tapering could move up earlier than when they originally thought. Whether that’s this year, we’ll see, but it certainly could.”

A number of Fed officials, including St. Louis Fed’s James Bullard and Kansas City President Esther George, have suggested that the tapering of bond buying be more weighted toward mortgage-backed securities because surging home prices suggest the market doesn’t need additional central bank support.

“Right now the housing market is on fire. They don’t need any other unnecessary support so I would be all in favor of that,” Waller said.

Economic projections released at their meeting showed 13 of 18 officials favored at least one rate increase by the end of 2023, versus seven in March. Eleven officials saw at least two hikes by the end of that year. In addition, seven of them saw a move as early as 2022, up from four.

Waller said he was not one of those who had pulled his dot projection forward. He declined to say in which year he favored liftoff, but did suggest that scaling back bond buying should come first.

“I myself would like to see tapering over before we consider raising rates,” Waller said. “Therefore if you think you may have to raise rates in late 2022 or early 2023, you pretty much want to get tapering done by the end of next year if possible.”

The former research director of the St. Louis Fed, Waller was sworn onto the Board in Washington in December after the U.S. Senate confirmed his nomination by former President Donald Trump.

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