By Yasin Ebrahim
Investing.com -- Federal Reserve Bank of St. Louis President James Bullard said Thursday he wasn't in favor of the Fed downshifting to a smaller rate hike at its meeting last month, adding that he wouldn't rule out advocating for a larger hike at the central bank's next meeting in March.
“I wouldn't rule anything out for that meeting or any meeting in the future,” Bullard said Thursday following a presentation to the Greater Jackson Chamber in Jackson, Tennessee, referring to the prospect of a 50 basis point hike in March.
The Fed downshifted to a 25-basis-point rate hike last month, and markets have been betting that just two further 25 basis points are ahead, bringing the Fed's funds rate to the 5% to 5.25% range.
The St. Louis President, who isn’t a voting member, confirmed that he pushed for the Fed to deliver another 50 basis points at the Jan. 31-Feb. 1. meeting, preferring to get the Fed’s benchmark rate to an adequately restrictive level faster.
The need for further rate hikes could help “lock in the disinflationary trend during 2023," the St. Louis fed president said, flagging the current labor market in which demand continues to far outpace supply as “unprecedented.”
Bullard’s comments echoed that of Cleveland Fed President Loretta Mester, who also isn’t a voting fed member, but said she saw a "compelling case" for a half-point rise at the Fed’s most recent meeting.