More from Fed's Bullard:
- Was among those who predicted three rate hikes for 2022 in December
- Balance sheet runoff should begin shortly after initial interest rate increase
- Better to get rate hikes going sooner rather than later. Can slow pace if inflation moderates
- Uncertain how much inflation control will depend on natural moderation versus Fed intervention
- Expects inflation to moderate naturally to some degree, but not dramatically, and still above 3% at end of year
- Balance sheet could decline even below pre-pandemic levels given existence now of standing repo facility
- Good reasons for labor force participation to be lower today than before the pandemic
- Very surprised by level of inflation; incumbent on central bank to act to maintain its credibility
- Pre-pandemic employment level, not a good benchmark of current very tight labor market
- Smaller balance sheet, higher policy rate means both ends of yield curve should rise in tandem
Earlier today Bullard said that he could see the first rate rise in March.
