St. Louis Fed President James Bullard told CNBC on Thursday the word “patient” should come out of the policy statement in March to give options for raising interest rates this summer. “There’s too much focus about the first move,” he said. “It’s really the path of rates that matter.”
Bullard, who’s generally hawkish, called possible rate hikes “the normalization process,” as he expects the unemployment rate to fall below 5 percent in the second half of the year and overall economic growth at 3 percent for 2015.
“I’d be for starting a little bit earlier on the normalization process. It’s not tightening,” he said in a “Squawk Box” interview. “It’s still going to be a very accommodative policy even if we move off zero.” He characterized the policy rate as 375-400 basis points below normal. “These labor markets are improving so rapidly,” Bullard said. “If you haven’t even come off zero and the unemployment rate has come down below 5 percent, that seems like a bit little extreme to me.”