Fed’s Bullard backs more rate hikes this year after ‘hot’ CPI data

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The Federal Reserve needs to be more aggressive this year to help cool down “stubbornly high inflation,” St. Louis Fed President James Bullard said Friday.

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In the wake of the “hot” consumer price inflation data released earlier this week, Bullard said he thinks the Fed needs to raise its policy rate to a range of 3.75% to 4% by the end of the year. That’s up from his previous preference of 3.5% year-end rate.

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Bullard is a voting member of the Fed’s interest-rate committee this year. His comments came during a webinar sponsored by the London-based European Economics & Financial Centre.

Since March, the Fed has raised its policy rate from close to zero to a range of 1.5-1.75%.

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Asked if his backing of a higher interest rate level by year-end meant that he supported a 100 basis point move in July, Bullard said the exact path of rates was a decision for the full committee.

The St. Louis Fed president said there wasn’t “too much difference” between doing 100 basis points in July and then less at other meetings, or moving by 75bp in July and doing more later.

The yield on the 10-year Treasury note TMUBMUSD10Y,
2.943%
moved slightly below 3% in Friday trading.

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Credit: www.marketwatch.com /

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