Bullard cautions on pace of US policy normalisation
St Louis Fed president concerned market expectations will threaten credibility
The president of the Federal Reserve Bank of St Louis has issued words of caution around normalising monetary policy in the US, after many emerging markets begin to feel the squeeze of higher interest rates.
According to James Bullard, “inflation expectations in the US remain somewhat low, suggesting that further normalisation may not be necessary to keep inflation near target”.
Currently, the PCE basis – the Fed’s indicator for market-based inflation expectations – remains centred below the
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