‘50% odds high inflation will persist in US’

WASHINGTON. Federal Reserve Bank of St. Louis President James Bullard said this year’s surge in inflation, which most central bankers view as temporary, may well persist amid a strong US economy and tight labour market. “While I do think there is some probability that this will naturally dissipate over the next six months, I wouldn’t say that’s such a strong case that we can count on it,” Bullard said Thursday during a virtual discussion hosted by the Euro 50 Group. “I would put 50 per cent probability on the dissipation story and 50 per cent probability on the persistent story.”

Bullard said he favoured the Federal Open Market Committee beginning to scale back its emergency pandemic support by tapering asset purchases and completing the process by the end of the first quarter. (Bloomberg)