Fed's Lacker: Return to Growth by Year-End

The U.S. economy looks "dismal" in the short term but should return to growth by year-end as housing markets finally reach "some sort of equilibrium," Richmond Federal Reserve Bank President Jeffrey Lacker told CNBC.

"I’m expecting a bottom at the end of the year and a little bit of positive growth,” Lacker said. “It does seem likely that we’re going to see some sort of equilibrium emerge in the housing market in the latter part of the year.”

Lacker said he is "fine" with the Fed's current stance of monetary policy and expects the fed funds rate to be pinned near zero for some time.

But Lacker repeated his qualms about the Fed's approach to targeting specific parts of the credit market, such as asset-backed securities, rather than taking a more neutral approach by purchasing Treasuries.

Lacker is a voting member of the Federal Open Market Committee in 2009.