Fed's Lacker: Low Rates May Not Be Needed Beyond Next Year

Fed President Jeffrey Lacker believes the Fed's timeframe to maintain low rates till the end of 2014 should be a forecast subject to change based on conditions rather than a straight up commitment. "I disagree with the Fed Chairman's timeframe," Lacker told CNBC's Steve Liesman in an extended Squawk Box on Friday. "Economic conditions will likely warrant low rates till the middle of next year." "And this is not a commitment," he notes on his prediction. "Nor is it, by the way, the Fed's statement on the end of 2014 as a timeframe for low rates, by the way. It is a forecast, and just as a forecast normally does, it should vary sensitively to conditions of the economy. It may be sooner that we raise rates." Asked on whether that forecast includes unemployment well below 8 percent he says, "It is a real possibility that unemployment could go below 8 percent." "We need to raise rates before that time where a rate of over 8 percent becomes the sustained rate of unemployment. Look, inflationary pressures increase even when unemployment is at that level," Lacker says, pointing at a major difference with Fed Chairman Bernanke.