Fed's Bullard Says Markets Have More Dovish View on Interest-Rate Path
May 25 2017 - 10:50PM
Dow Jones News
By Michael S. Derby
Federal Reserve Bank of St. Louis President James Bullard warned
again on Thursday that the central bank and financial markets
aren't on the same page when it comes to the interest-rate
outlook.
The movement of financial asset prices since the Fed's March
interest-rate increase shows the central bank's "contemplated
policy rate path is overly aggressive relative to actual incoming
data on U.S. macroeconomic performance," he said in materials
prepared for a presentation in Tokyo, which will happen on Friday
local time.
Mr. Bullard, who isn't currently a voting member of the
interest-rate setting Federal Open Market Committee, has for some
time been a deep skeptic of the need to raise rates. T he Fed is
widely expected to boost the cost of borrowing at its June policy
meeting, lifting the overnight target rate from its current range
of 0.75% and 1%. In recent appearances, Mr. Bullard has said a rate
rise or two wouldn't be a big issue for him, but he opposes the
central bank's current plan to pursue a series of rate rises over
the next few years.
Mr. Bullard said the shortfall of inflation relative to the
Fed's 2% target remains "worrisome" but he still expects the
economy to remain on a path of about 2% growth. He doesn't expect
to see a surge in inflation.
Write to Michael S. Derby at michael.derby@wsj.com
(END) Dow Jones Newswires
May 25, 2017 22:35 ET (02:35 GMT)
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