Fed's Bullard says volatil­ity isn't chang­ing eco­nomic out­look

The Pak Banker - - COMPANIES/BOSS -

St. Louis Fed­eral Re­serve Pres­i­dent James Bullard said that while world fi­nan­cial mar­kets are volatile, US fun­da­men­tals are good and the in­ter­est rate- set­ting Fed­eral Open Mar­ket Com­mit­tee shouldn't al­ter its forecast for the econ­omy.

"The key ques­tion for the com­mit­tee is -- how much would you want to change the out­look based on the volatil­ity that we've seen over the last 10 days, and I think the an­swer to that is go­ing to be: not very much," Bullard said in an in­ter­view Fri­day at the Kansas City Fed's an­nual con­fer­ence in Jack­son Hole, Wy­oming.

"You've re­ally got the same tra­jec­tory that the com­mit­tee will be look­ing at that we were look­ing at be­fore, so why would we change strat­egy, which was ba­si­cally to lift off at some point," said Bullard, who votes on the FOMC next year.

Fed of­fi­cials are weigh­ing when to be­gin lift­ing in­ter­est rates for the first time since 2006. While the U.S. is grow­ing at a solid clip, in­fla­tion is too low and the global out­look has been dimmed by a Chi­nese slow­down that is driv­ing down com­mod­ity prices and spurring eq­uity mar­ket tur­bu­lence. "I ac­tu­ally think we're OK on the in­fla­tion front," Bullard said.

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