WASHINGTON (Reuters) – If the Federal Reserve misreads the strength of future inflation in order to delay tightening monetary policy now it could require “very disruptive” and swift changes in policy down the road, St. Louis Federal Reserve president James Bullard said Wednesday.
Arguments in favor of a “go slow” approach to changing monetary policy are “a playbook from the aftermath of the global financial crisis,” less relevant to an economy with higher than expected inflation and likely fast job growth, Bullard said. “We could really get into trouble if we commit,” to a delayed exit from low interest rates and the current $120 billion in monthly bond purchases, he said.
(Reporting by Howard Schneider)
