'Fed Maepa Chulsin' Bullard "Inflation May Rise Again...Long Way to Go"

"There is still a long way to go." James Bullard, former President of the St. Louis Federal Reserve Bank and a representative hawkish (favoring monetary tightening) figure, warned of the persistent risk of inflation rebounding.

James Bullard, former President of the Federal Reserve Bank of St. Louis, USA (Photo by Bloomberg News)

Bullard, who left the St. Louis Fed and became the dean of the Krannert School of Management at Purdue University, stated in an interview with CNBC on the 14th (local time), "I believe there is a very high possibility that the (easing) inflation trend will reverse and go down the wrong path."

He said, "So far, the (easing inflation trend) has been good news for the Federal Open Market Committee (FOMC)," but also pointed out, "I think we need to look at the data carefully." After the Fed raised the benchmark interest rate to the 5.25-5.5% range, recent inflation has shown a clear slowing trend in the indicators. The Personal Consumption Expenditures (PCE) price index, which the Fed monitors, fell from 5.5% last year to around 3.7% recently. The Consumer Price Index (CPI) for October, released on the same day, also rose 3.2% year-over-year, falling below both the previous month's 3.7% and market expectations of 3.3%.

However, Bullard warned that there is always a risk of inflation rebounding. He said, "(The inflation indicators) look quite good," but added, "It is still far from reaching half of the target of 2%, so there is still a long way to go." He also emphasized, "The good disinflation we have seen over the past 12 months may not continue, which remains a risk for the FOMC," and "They need to do more."

Bullard is a representative hawkish figure who publicly urged rate hikes within the Fed since 2021, before the Fed's tightening policy fully began. Even after retiring this year, he has continued to show his hawkish stance in official settings.