Fed’s Bullard: Aggressive pace of rate hikes could invert yield curve

Dhwani Mehta FXStreet

St Louis Federal Reserve (Fed) President James Bullard is out on the wires now, via Reuters, commenting on the rate hike outlook and inflation expectations in Tokyo.

Key Headlines:

Fed should be cautious with further rate increases.

US policy possibly at neutral, so Fed should be cautious.

Inflation expectations are still a bit low.

It is a question of how far the Fed should go while ECB, BOJ remains on hold.

Slower pace of rate hikes could re-center expectations.

Aggressive pace of rate hikes could invert yield curve.

Oil has only a temporary effect on inflation.

Inverted yield curve helps predict US recessions.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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