James Bullard, head of the St Louis Federal Reserve, one of the more hawkish exponents of the institution, said he believes the US central bank will raise interest rates twice in 2022, after completing the tapering phase of its purchases. of bonds, just announced by President Jerome Powell.
Bullard is not currently a voting member of the FOMC, but will be in 2022.
The banker explained his point of view with the current macro data, pointing out that his opinion could therefore also change, depending on the economic information that will arrive over time.
“What we can do is evaluate the situation next spring and understand where we are: at that point we will be able to make a decision on whether or not to raise interest rates,” said Bullard, interviewed by Cnbc at the UBS European Conference. “Based on the situation I think we are in today, I really believe that two rate hikes are set for 2022 … but that could change within the first half of next year, in both directions.”
Yesterday the US producer price index was released, an important inflation thermometer, which in October jumped by 8.6% on an annual basis: less than the + 8.7% expected, but still at a record pace in almost 11 years.