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St. Louis Federal Reserve Chairman James Bullard said Friday that the central bank's monetary policy is now "a little tight" and should be reconsidered.
Speaking at a time when the White House is pushing the Fed to lower rates, Bullard has not embarked on this path, but noted the low level of inflation and expectations in the markets financial.
"I think we're a bit tight on the funds rate, not too much, but a bit tight," he told CNBC's Steve Liesman in an interview for "Squawk on the Street." ". "I think the overall real risk free rate in the near term is about zero."
If the real rate measured against inflation is zero and inflation is around 2%, it should also put the Fed's benchmark at 2%, he said. The federal funds rate is currently in the range of 2.25% to 2.5%.
"I would like to seize this opportunity to boost inflation expectations to 2%, and I think it will bring nice dividends for the Fed in the future," Bullard said. "We have made big strides in monetary policy over the last three or four months, and I think it's time to wait and see how this will affect the economy." 39; future. "
Indeed, the Fed spun its policy in January stating that it would be "patient" about implementing changes in monetary policy. The central bank advanced this position in March by modifying its rate forecasts, which went from two increases planned this year to none.
Even so, President Donald Trump has been pressuring Fed officials to change course and reduce their rates. He said earlier this week that he wanted a total reduction of the percentage point.
"We get advice from all kinds of people, including you and other politicians," Bullard told Liesman. "We receive a lot of information from different angles."
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