Wednesday (18th), Governor of the Federal Reserve Bank of St Louis Brad (James Bullard) said the Fed tightening may be during the year, reducing its total assets. Even in recent weeks there have been signs of easing of inflation.
Brad said in an interview, he still believes the expected fed years of belt tightening is reasonable. He said personal preference in the priority on the balance sheet of the monetary policy, and believe the Fed will adopt such policies, allowed after expiration of bonds held by the Federal Reserve total assets declined.
recommended reading
fed crunch policy rxw dollars rally can period euro recent performance can worry future ten years RMB will continues to appreciation cover special is satisfied that: Republican fear be Tan responsibility debt default us then set off subprime investigation spearhead directly at the three large line Xia a any IMF President should is Oriental people Moody's cut Australia four line credit rating deciphered fuck disk password master main trends Brad said He worried excessively high inflation data have, however he believes that in the United States Treasury inflation hedge bonds (TIPS) market, expected rate of inflation has returned the following line.
he believed that if the United States economic recovery in the second half, it is necessary to pay special attention to inflation and expected inflation rate will rebound again on the increase.
yields on Treasury 10 this week dropped to 3.09%, for 2011 has the lowest level in years.
Brad said if not handled properly, the Fed's balance sheet operation can lead to high inflation. Brad comments refers to the record of the Federal Reserve's stimulative monetary policy before.
Brad on inflation worries marked his policy tendency of change. 2010 Brad urges federal reserve to buy Treasury bonds to avoid massive deflation, he is also the first to support take second round Treasury bond purchase of Fed officials.
Brad said, the Federal Reserve in June are likely to take "pause wait-and-see" policy, and then further assessment of the economic development.
4 month for the first quarter of the Federal Reserve United States economic slowdown lowered its economic growth forecasts for the year 2011, and a higher inflation expectations other than food and energy prices.
Brad said, if the strong growth in the first quarter, austerity policy needs to be more urgent.
current interest rates since December 2008 remain at near zero interest rates, and in March 2009 the Fed pledged to maintain the special low interest rate level of extended periods of time.
Brad is expected in 2011, the remaining month between the economic growth rate will be 3% per cent.
Brad optimistic about the year employment growth, layoffs had been adopted in many companies in the financial crisis reached a maximum level of downsizing.
due to normal voting right rotation, Brad in the Federal Reserve's Federal open market Committee this year does not have the eligibility to vote.
