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By One Measure, Rates May Still Need to Rise 300 Basis Points, Fed’s Bullard Says

  • St. Louis Fed boss says central bank may be ‘behind the curve’
  • Markets have already priced in hikes, however, he says
James Bullard

James Bullard

Photographer: Luke MacGregor/Bloomberg
Updated on

Federal Reserve Bank of St. Louis President James Bullard said he favors raising interest rates sharply to counter the highest inflation in four decades, and suggested he backs a half-point hike in May along with shrinking the Fed’s bloated balance sheet.

“I would like the committee to get to 3-3.25% on the policy rate in the second half of this year,” Bullard told reporters Thursday after a speech at the University of Missouri. “We have to move forthrightly in order to get the policy rate to the right level to deal with the inflation we have got in front of us.”