Bullard says he would like to cut rates by 25 bps this month

Author: Adam Button | Category: Central Banks

Bullard on rates

  • Would like to cut by 25 bps (not 50 bps)
  • A 25 bps cut would give the Fed optionality for later in the year
  • Too-slow inflation response would be reason to cut further, along with worse outcomes on trade war
  • Rate cut now would be pre-emptive
  • No need to revisit timing on balance sheet runoff
  • Wants to see upward-sloping yield curve
  • Fed not on a pre-set course
  • It would be difficult for the Fed not to ease July 31 at this point
Fed officials have characterized a cut as 'strategic' and 'pre-emptive' now along with mentioning 'insurance'. The market continues to price in a rate-cutting cycle.

In a sense, Bullard is right because it will all come down to how the trade war goes.

ForexLive
By continuing to browse our site you agree to our use of cookies, revised Privacy Notice and Terms of Service. More information about cookiesClose