Conflicting reads from different data caused the Federal Open Market Committee to push back liftoff, Federal Reserve Bank of St. Louis President James Bullard said Tuesday.
Projections for real gross domestic product, the unemployment rate and inflation were all wrong over the past year and a half, he told the 20th Annual Indiana Economic Outlook Luncheon at Ball State University, according to prepared text release by the Fed. "The surprise has been that real GDP growth has been slower than expected, inflation has been lower than expected, and labor markets have improved more rapidly than expected," he explained.
"These misses are such that they continue to pull the Committee in different directions on monetary policy," Bullard said. "Unexpectedly low inflation and real GDP growth suggest pushing policy in a somewhat easier direction. Robust labor markets suggest pushing policy in a somewhat tighter direction," he explained. Bullard noted that, in response to these surprises, the FOMC's adjustment to policy was to move toward a later normalization.
