St. Louis Federal Reserve President James Bullard said that he is currently anticipating the U.S. Federal Reserve Central Bank to increase its benchmark rate twice in the next year.
Bullard expressed that his opinion is based on present economic data and expressed that his prediction may change as time progresses.
Bullard told Julianna Tatelbaum at the UBS European Conference, “What we can do is assess the situation next spring and see where we’re at, and at that point, we can make a decision about raising the policy rate.”
Bullard added, “Based on where I think we are today I actually have two rate increases penciled in for 2022, that could change by the time we get into the first half of next year in either direction really.”
Bullard has shown some anxiety at the increasing levels of inflation as U.S. wholesale price index increased 8.6% from a year ago. This increase is the highest yearly increase in records in the last 11 years.
Central banks generally increase rates to decrease inflation and the Federal Reserve has started a normalization policy. Fed Reserve acknowledged last week that price increases had been quicker and enduring than its forecast.
Bullard is not yet a voting member on the central bank’s policymaking committee but will be a voting member in 2022.
