St. Louis Federal Reserve Bank of St. Louis Governor Bullard said a decision to raise rates at the Federal Open Market Committee (FOMC) meetings in March and May would be desirable, but negatively thought regarding the benefits of higher rate hikes than expected. Indicated. The Governor will have the right to vote for the FOMC this year.
“I don’t think 50 basis points (bp, 1bp = 0.01%) will help us, at least as far as we can think of,” he said in an interview with Archyde.com. “We can take a disciplined approach to raising the policy rate, and that expectation has already been factored into the market,” he explained.
President Bullard
Photographer: Luke MacGregor/Bloomberg
He said he would leave guidance on future interest rate paths to the chairman of the Federal Reserve Board (FRB), but did not deny the prospect of raising interest rates five times this year.
“The market is factoring in five times. This isn’t too bad at this point. It depends a lot on how inflation will move this year,” said Bullard. “Inflation slows in the next few announcements.” I don’t think so, but by mid-year you’ll see if it’s progressing. “
He said he would support the start of the Federal Reserve’s balance sheet compression in April-June (second quarter), noting that the US financial authorities have not fallen behind in controlling inflation, given its effectiveness and rate hikes. However, it is “controversial” whether the authorities’ policies need to step into the territory of economic restraint to calm price pressures. The unemployment rate is projected to fall below 3% by the end of the year.
“We can take some steps at this stage to check the situation at mid-year to put monetary policy in a more appropriate position,” he said. “By July and August. It will be possible to evaluate. “
news-rsf-original-reference paywall">Original title:
news-rsf-original-reference paywall">Bullard Backs March Liftoff, Second-Quarter Balance-Sheet Shrink(excerpt)