Fed’s Bullard: Inflation will be more persistent than predicted
President of the Federal Reserve Bank of St. Louis James Bullard stated on Wednesday that he believes inflation will be more persistent than people predict.
Bullard said that the United States saw a “major inflationary shock,” noting that the country hasn’t seen inflation above the 2% target since the target was set in 2012. Moreover, he noted that current levels are the highest in 30 years, adding that this is a “very different type of environment” due to the pandemic.
Bullard also projected that inflation levels will be around 2.5% to 3% in 2022, leading to the target of 2% by 2023. However, he stated that if levels are at the higher margins, downward pressure may need to be implemented and it might be better to taper earlier and faster now to be in a stronger position in 2022.
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