Low U.S. inflation means the Federal Reserve can stick to an aggressive bond buying campaign if it decides that is warranted, even though the nation’s jobs market has perked up since the program was launched, a senior central banker said on Monday.
“Labor market conditions have improved since last summer, suggesting the Committee could slow the pace of purchases, but surprisingly low inflation readings may mean the Committee can maintain its aggressive program over a longer time frame,” said St. Louis Fed President James Bullard.
Bullard is a voting member of the Fed’s policy-setting committee this year.
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