WASHINGTON — The Federal Open Market Committee has in the past put its policy on hold, Federal Reserve Bank of St. Louis president James Bullard said Monday, adding that this gives more time to assess the strength of the nation’s economy.
In prepared remarks, Bullard reiterated his call for inflation targeting. He also said the ultimate policy goal when it comes to prices is headline inflation, as opposed to core inflation.
In fact, “too much attention to core can mislead” policymakers, he said.
While discussing upcoming monetary policy after the end of the second round of quantitative easing in June, Bullard noted that “past behavior of the FOMC indicates the committee sometimes puts policy on hold.”
In the current environment, he said, this would mean keeping the federal funds rate near zero and the “extended period” language intact.