The Fed needs to raise rates substantially to control inflation but may not be as 'behind the curve' as it appears, St. Louis Fed President James Bullard said.
St. Louis Fed President James Bullard said the central bank is "behind the curve" on interest rates, but it's making progress.
"If you take account of [forward guidance] we don't look so bad. Not all hope is lost. That is the basic gist of this story," Bullard said in a speech at the University of Missouri. "U.S. inflation is exceptionally high, and that doesn't mean 2.1% or 2.2% or something. This means comparable to what we saw in the high inflation era in the 1970s and early 1980s," he said. "Even if you're very generous to the Fed in interpreting what the inflation rate really is today … you'd have to raise the policy rate a lot."
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