Thomas Hoenig, one of the most outspoken anti-inflation hawks among senior Federal Reserve officials, will step down from the Kansas City Fed October 1 as widely expected after he reaches mandatory retirement age, according to a bank statement on Friday.

Hoenig's departure will remove a strong voice of opposition to the Fed's easy money policies. The Kansas City Fed president called the most recent round of bond buying a bargain ... with the devil because he worries an extended period of ultra-low interest rates is setting the stage for another damaging boom and bust cycle.

The Kansas City Fed has created a committee and hired an executive search firm to help find Hoenig's successor, who is expected to be named in time for the regional Fed's annual conference at Jackson Hole, Wyoming in late summer. That gathering in a remote lodge at the foot of the Teton mountains draws a who's who of central bankers and economists from around the world and has in recent years been a venue for major policy pronouncements by the Fed.

Hoenig is the longest-serving participant on the Fed's policy-setting open market committee and is regarded as one of the strongest skeptics of the central bank's aggressive efforts to cut unemployment, which has remained stubbornly high even though the recession officially ended almost two years ago.

When Hoenig rotated into his turn as a voter on the committee in 2010, he dissented against the Fed's policies at all eight meetings.

Hoenig last year called for raising benchmark interest rates, which are near zero, to one percent, and made clear his opposition to the Fed's $600 billion bond buying program that was launched in November.

Fed rules require regional Fed bank presidents to step down upon turning 65, and the departure of Hoenig, who reaches that milestone in September, was expected. He is the current longest-serving president of a Fed bank.

Hoenig began his career in the Fed system in 1973 as an economist in the bank supervision group. His experiences shuttering banks during the savings and loan crisis of the 1980s, when over-investment in real estate caused hundreds of bank failures and necessitated a massive government bailout, shaped his views about how to emerge from the most recent crisis.

He became head of the Kansas City Fed in October 1991.

Hoenig has been a vocal proponent of allowing regulators to break up large banks if they take on risky activities or become so big that investors and the public assume the government would rescue them in a panic.

(Reporting by Mark Felsenthal; Editing by Andrea Ricci)