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Fed's Bullard says he is happy with where interest rates are

Fed's St. Louis James Bullard has been crossing the wires again, adding that he is happy with where interest rates are, Fed should wait and see what effects will be of rate moves to date.

Key comments

 

  • Bullard says end of year management of repo market was "quite successful".
  • Bullard says favors a standing repo facility to be put in place as a long-term solution.
  • Bullard says upward inflation pressure would be welcome.
  • Bullard says would like to keep balance sheet as small as possible, feels standing repo would help achieve that if banks know they can get reserves from the fed as needed.

Earlier comments

  • Something like average inflation targeting would ‘make a lot of sense right now’ given several years of inflation being below target.
  • Reasonable chance of "soft landing" for u.s. this year from fast 2018 growth, 2019 risks.
  • Says businesses are adjusting to remain profitable even in the face of trade uncertainty.
  • Bullard says recent developments suggest "near-term uncertainty" about trade policy has "abated somewhat," and will be less of an issue in 2020 than it was in 2019.
  • Bullard notes seemingly large gains in stocks last year influenced by late 2018 selloff; index "essentially unchanged" from Oct. 2018 to Oct. 2019.

About James Bullard

Fed dove James Bullard from St. Louis, who wanted a half-point rather than quarter-point cut in September, has been replaced this year and is no longer a voting member, so his comments are less impactful on the market. 

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