Speech

Bullard Discusses Interest Rates and Containing Inflation with MarketWatch

Abstract: In an interview with MarketWatch during a Barron’s Live event, St. Louis Fed President Jim Bullard talked about the level of the policy rate needed to put sufficient downward pressure on inflation. Citing his Nov. 17 presentation to Greater Louisville Inc., Bullard reiterated that the policy rate would need to reach at least the bottom end of a 5% to 7% range to be sufficiently restrictive, given the data the Federal Open Market Committee has today. “I also think that we’re going to have to continue to pursue our interest rate increases into 2023, and there’s some risk that we’ll have to go even higher than the lower end of that range as we go through 2023 if the inflation data in particular does not cooperate with us,” Bullard said. Rates may have to stay in the restrictive range throughout 2023 and into 2024, he added. Bullard also talked about strong U.S. labor markets, his expectation for below-trend GDP growth in 2023, quantitative tightening of monetary policy through balance sheet reduction, the yield curve inversion, and the slowdown in the housing market.

Keywords: inflation; policy rate;

Bibliographic Information

Provider: Federal Reserve Bank of St. Louis

Part of Series: Speech

Publication Date: 2022-11-28