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ORLANDO, Fla. (Reuters) - A top U.S. Federal Reserve official said on Thursday he supported the U.S. central bank's decision to leave interest rates unchanged at its policy meeting earlier this month until there was more evidence the economy is approaching the Fed's goal of full employment and 2 percent inflation.
Atlanta Federal Reserve President Dennis Lockhart said he expected the Fed would raise interest rates "before long".
"However, I did support the consensus view that before taking the next move, it makes sense to see a little more evidence of progress toward our statutory policy objectives," he said in reference to the Fed's most recent policy statement from its September meeting.
Lockhart's comments were in a prepared speech at an event here sponsored by the Florida Chamber Foundation. He is not a voting member of the Federal Open Market Committee, the Fed's policy-setting group, and he will retire from his position in February 2017.
The jobs market has shown further improvement with signs of a modest rise in labor participation, but Lockhart said the longer-term trend is biased toward a decline as more Americans will retire in coming years.
This view on labor participation, together with modest capital spending, would support an expected 2 percent annual growth rate for the U.S. economy, Lockhart said.
"With declining participation - even while the population is growing - and weak investment in capital goods, the country has challenges achieving strong growth," he said.
Reporting by Richard Leong; Editing by Chizu Nomiyama