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'Hurdle pretty high' to change taper: Fed's John Williams

Incremental changes in the nation's unemployment rate and economic outlook won't likely change the rate at which quantitative easing will be tapered, Federal Reserve Bank of San Francisco President John Williams said Wednesday.

"I think in my view, the hurdle is pretty high on changing the pace of the step-downs in our purchases that we started back in December," he said on CNBC's "Halftime Report."

Williams emphasized taking a medium-term look at the data. "What I'm looking for is steady improvement in the labor market generally, and we are seeing that in other series that the government follows, such as job vacancies and perceptions of the job market," he said.

"I really don't want to overreact to any specific piece of data and really look at what it means for the medium-term trend."

The minutes from the Federal Open Market Committee's January meeting were expected to be released on Wednesday, providing clues to the Fed's plans for its bond-buying program.

"We think we're at a good place to start pulling back the gas somewhat. We're not tightening policy. All we're doing is lessening or reducing the amount of additional stimulus we're adding," Williams said. "So, I don't see it as a race to get out of QE3 or something. I see it really as a sign of success and a sign of improvement in the labor market that we can start pulling back on this."

While the FOMC would discuss any threshold for a shift in Fed monetary policy, Williams took a broader view less dependent on fixed targets.

(Read more: What the Fed will tell markets this week)

"But now in the current situation where the economy's doing better, my own view is we should move back to more of a verbal description, use our projections and our speeches and our statements to qualitatively guide the public about what our views are and not rely on some kind of markers or hard numbers in our statements," he said.

"I think it's time to move away from these numerical markers and just go back to a more qualitative description of our policy framework and the drivers of our decisions."

The recent spate of cold weather throughout much of the country could have a damping effect on the economy, Williams said.

"What we do know is when it's unusually cold in winter, people do cut back on spending somewhat, especially, we've seen that in auto sales and things like that," he said. "So, we'll be watching the data over the next few months. I'll be watching the data carefully to see to what extent it was weather, or maybe some signs of a little bit weaker underlying momentum. But so far, I think we're on a really solid footing in 2014."

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Williams said that he expected moderate, improving growth for the next couple of years.

"I think we've become much more humble and more realistic about what that could mean," he said. "My own forecast is for growth a little under 3 percent for real GDP, fourth quarter over fourth quarter for this year, and a little above 3 percent for next year."

While that may not be "blockbuster growth," Williams said that it was "still above trend."

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"We should see steady growth in jobs and reductions in unemployment," he also said, adding that he hoped to see economic tailwinds, "both in the housing and on the business-investment side."

By CNBC's Bruno J. Navarro. Follow him on Twitter @Bruno_J_Navarro.

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