Fed's Waller says reserves still abundant, no need to slow pace of balance sheet drawdown

March 21 (Reuters) - Federal Reserve Governor Christopher Waller on Friday said he opposed the decision at this week's U.S. central bank meeting to slow the pace of reduction of its securities holdings because the level of reserves in the banking system remains abundant.

"Reducing the Federal Reserve's balance sheet is an important part of normalizing monetary policy implementation and reducing unneeded reserves in the banking system," Waller said in a statement explaining his dissent. "Slowing further or stopping redemptions of securities holdings will be appropriate as we get closer to an ample level of reserves. But in my view we are not there yet because reserve balances stand at over $3 trillion and this level is abundant."

"There is no evidence from money market indicators or my outreach conversations that the banking system is getting close to an ample level of reserves," Waller said.