Fed Dove James Bullard Backs Quarter-Point Cut, Would Love to Be Chair
James Bullard said he didn’t view an aggressive easing campaign as necessary.
(Bloomberg) -- James Bullard, one of the most dovish members of the U.S. central bank, favors lowering interest rates by a quarter point when officials meet later this month and said that becoming Federal Reserve chairman is “something I’d love to do.”
“If I ever got that honor, I would certainly take it,” the St. Louis Fed president told reporters Friday in New York. “I notice the phone hasn’t been ringing off the hook to get that. And obviously it’s something that the stars have to align for that to happen.”
Bloomberg has reported that President Donald Trump discussed firing or demoting Jerome Powell, whom he picked to be Fed chair. Powell says he will serve out his four-year term and would not step down if asked to do so by the president.
Trump has relentlessly attacked the Fed for raising rates last year and renewed his criticism Friday with a barrage of tweets, including one citing a speech the day before from the New York Fed that initially increased bets of a half-point reduction before a spokeswoman walked it back.
“I like New York Fed President John Williams first statement much better than his second,” Trump said. “His first statement is 100% correct in that the Fed ‘raised’ far too fast & too early. Also must stop with the crazy quantitative tightening.”
Fed officials are widely expected to cut rates by at least a quarter point at their July 30-31 meeting to offset uncertainties stemming from Trump’s trade policies and weakening global growth, even though U.S. unemployment is near a 50-year low.
Bullard, who dissented last month when his colleagues held policy steady because he favored a quarter-point cut, said that he didn’t view an aggressive easing campaign as necessary.
“I’d like to go 25 basis points at the upcoming meeting,” he said. “I think easing cycle is a little bit strong for this situation. I like to point to the late-1990s examples: 1995-96, and then again, 1998, during the Asian currency crisis.” The Fed initiated several so-called insurance cuts during this period in order to keep the U.S. economy growing.
To contact the reporter on this story: Matthew Boesler in New York at mboesler1@bloomberg.net
To contact the editors responsible for this story: Alister Bull at abull7@bloomberg.net, Vince Golle
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