Despite a better-than-expected jobs report last week, the Federal Reserve would mostly wait until March to begin to scale back its $85-billion-a-month bond-purchasing program, Jan Hatzius, the chief economist of Goldman Sachs, told CNBC on Monday.
Hatzius said Fed officials want to wait for the possible transition of Janet Yellen to the chair position from Ben Bernanke. Yellen's nomination faces its first confirmation hearing Thursday. Yellen is expected to succeed Bernanke when he steps down this January.
Hatzius also said Fed officials would evaluate the expected budget showdown between President Barack Obama and House Republicans this January before deciding when to taper, and that lawmakers would most likely reach a "small fiscal deal" that averts the next stage of the sequester.
"It's going to be a tough transition," Hatzius told CNBC on "Squawk on the Street" on Monday. "It probably always is a tough transition but particularly in an environment where policy is somewhat in flux, where there is a sense that they do want to scale back the QE program at some point, but of course there has been many twists and turns in this saga, and it's going to be hard for her."