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Bullard Says Fed May Raise Main Rate by June 2014

Federal Reserve Bank of St. Louis President James Bullard said U.S. unemployment may drop to 6.5 percent by the middle of next year and prompt the central bank to raise its benchmark interest rate from near zero.

“The current St. Louis Fed forecast for the unemployment rate implies that the 6.5 percent threshold will be crossed in June 2014,” Bullard said today in New York. The Fed last month renewed its pledge to keep borrowing costs low “at least as long” as joblessness exceeds 6.5 percent and if projected inflation won’t go beyond 2.5 percent one or two years in the future.