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A dovish St. Louis Fed President Bullard speaking in Louisville said the yield curve is in more normal state which could be bullish for the economy in 2020. Risks remain but Fed cuts this year may prompy growth.

Fed Bullard

Bullard speech comes after Federal Reserve Chair Powell ed Chair Powell Testified to the Congressional Joint Economic Committee and the House Budget Committee.

Highlights

  • Yield curve in more normal state could be bullish for economy in 2020
  • Bullard flagged concerns over yield curve inversion but says monetary policy now considerably more accommodative
  • Risks remain but Fed cuts this year may prompt faster than expected growth, better inflation outcomes next year
  • Fiscal, monetary policy will be more effective if they can work together
  • Rate cuts may re-center inflation, expectations

Bullard questions and answers after speech

  • Fed needs a measured approach to monetary policymaking
  • Fed did not use negative rates because US economy stronger than others
  • US economy more dynamic than Europe, Japan

Source: Reuters

From The TradersCommunity Research Desk

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