Four consecutive strong inflation reports, from October to January could lead to a faster pace of the Federal Reserve’s rate hike, the St. Louis Fed president said. Louis James Bullard on Monday, reiterated his call for a 1 percent rate hike by July 1st.
“The last four forecasts taken in tandem have shown that inflation is rising and is likely to continue to grow in the United States. Therefore, I have not changed any of my views before. " Said Bullard.
Bullard last week called for a half -percentage point increase at the Fed meeting in March after a stronger -than -expected inflation report in January. Even so he handed it to Jerome Powell about the right time for a rate hike.
In addition, he also opined that a simple policy will not necessarily have a big impact on the stock market. “I really don’t see any threat to the market at this point,” Bullard said.
The economy is expected to grow at an annual rate of 3.5% -4% this year, aided, by the reduction in the contagion impact of the Omicron variant. Finally, he said the annual CPI reading of 7.5% in January was a figure "never seen by Alan Greenspan."
The market is now preparing ahead of the Fed’s meeting in March with the expectation that the Fed will start raising interest rates.
