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Fed’s Bullard Says Low Inflation Could Require More Stimulus

James Bullard, president of the Federal Reserve Bank of St. Louis, said inflation has fallen too far below the Fed’s 2 percent goal, and a further drop could prompt increased asset purchases by the central bank.

“Inflation should be closer to target than it is, and we should defend the inflation target from the low side,” Bullard told reporters today after a speech in New York. “If it doesn’t start to turn around here soon, I think we’ll have to rethink where we are in our policy.”