Feds Bullard speaking ahead of the quiet period
- wait and see on inflation because we've been too low
- Fed policy can be less preemptive on inflation
- May see more inflation in 2021, 2022 then we are used to
- looks like were going to have robust economy in 2021
- markets trust the Fed to keep inflation under control
- would welcome inflation above 2% on a sustained basis
- it's okay if were 0.5% above feds target for some time
- better outlook is bringing real yields higher
- 10 year yields now returning to pre-pandemic levels
- would be concerned by disorderly trading; we are not at that point
- still need a lot of repair in the labor market
- getting lots of reports about shortages of goods and products
- makes sense that commodity prices would be on a tear as pandemic nears end
- commodity price jump doesn't equal sustained inflation
- sees unemployment falling to 4.5% by the end of 2021 (the current unemployment rate is 6.2%)
- could see inflation above 2% by the year end
The Feds quiet period is set to start tomorrow and runs to March 18th. The FOMC meets on March 16-17 with the decision announced on March 17th.
