February 21, 2019
St. Louis Fed President James Bullard shared his views on inflation, interest rates and the Fed’s balance sheet, among other things, with CNBC’s Squawk Box on Feb. 21.
In the interview, Bullard noted that the normalization process in the U.S. is coming to an end. “I think we’re in a very good place today,” he said. “We’ve got this muted inflation, no urgency for action. I think we’re data dependent going forward.”
Bullard reiterated his view that there has been a breakdown in the Phillips curve, which explains the feedback between the real economy and inflation. Despite the upside performance of the U.S. economy in 2017 and 2018, there still wasn’t any inflation in that environment, he pointed out. “So I think that’s got people backing off the idea that there’s such a lockstep relationship between the real economy and inflation,” Bullard said.
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