Bullard on CNBC:
- Fed was expecting a good reopening but this is better than expected so it's natural to 'tilt hawkish'
- Inflation more intense than expected
- Recent data 'very good news' and expect to see lots of continued improvement
- Upside risk of inflation is 'okay' since that was what the Fed was hoping for
- Infrastructure debate unlikely to affect the Fed
- Chair opened taper debate at last meeting, more in depth discussion to follow
- I'm personally leaning toward the idea that the Fed does not need to be in MBS
- US does not want to get into a housing bubble
- Fed has to be ready to adjust taper 'as necessary'
- Agrees that June Fed meeting represented a somewhat hawkish move
- Says his dot reflects a hike in 2022 (one of 7 dots for an early hike)
- Sees strong inflation of 2.5-3% through 20222, meeting framework goals and justifying rate hike
US equity futures are falling further on his comments and the dollar has ticked higher.
The bolded qualifier is an interesting one and will be the way to evaluate whether a hike is coming or not.
