Fed’s Bullard Says March Jobs Report Doesn’t Change OutlookJeff Kearns and Jeanna Smialek
Federal Reserve Bank of St. Louis President James Bullard said payroll growth slumping to a nine-month low doesn’t change his forecast that the jobless rate will decline to about 7 percent by the end of this year.
“I’m inclined to look past the report because I think there are some mixed messages in there,” Bullard, who votes on the policy-making Federal Open Market Committee this year, told CNBC today in an interview from St. Louis. “We want to kind of wait and see and that’s where I am right now. I wouldn’t change my forecast based on this.”
Fed officials are debating how to eventually curtail asset purchases that have swollen its balance sheet to a record $3.22 trillion. The FOMC in March agreed to keep buying $85 billion in bonds per month in an effort to bolster economic growth and reduce unemployment that was at 7.6 percent last month.
Bullard, one of the first officials to urge slowing the pace of bond buying in 2013 if economic conditions allowed, said today policy makers probably will “slowly ratchet down the pace of purchases” as the economy continues to improve.
“That’s a great policy, serves us very well,” Bullard said today. “And the notion that when a little bit weaker data comes in or a little bit stronger data comes in, well the Fed policy is going to adjust in response to that -- so I think that’s been a very good development.”
The 88,000 pace of payroll growth in March was the slowest in nine months and less than the most pessimistic forecast in a Bloomberg survey. It followed a revised 268,000 February increase, Labor Department data showed last week.
Bullard, 52, joined the St. Louis Fed’s research department in 1990 and became president of the regional bank in 2008. His district includes Arkansas and parts of Illinois, Indiana, Kentucky, Mississippi, Missouri and Tennessee.