Image clip CNBC interview 

Credibility On the Line

In a CNBC Interview, James Bullard stressed the needs to ‘front-load’ rate hikes to combat inflation. 

Bullard Statements 

• We have the hot CPI report. Not so much that report alone, but the last four reports taken in tandem have indicated inflation is broadening and possibly accelerating.
• I am just one person but I would like to see 100 basis points on the policy rate by July 1.
• "I do think we need to front-load more of our planned removal of accommodation than we would have previously. We’ve been surprised to the upside on inflation.
• This is a lot of inflation in the US economy. 7.5% on the headline CPI. These are numbers Alan Greenspan never saw and haven't occurred in 40 years.
• Our credibility is on the line and we do have to react to data.
• My position is a good one and I will try to convince my colleagues it's a good one.
• Inflation is much higher than we would have expected six months ago, nine months ago, and certainly twelve months ago.We've been surprised to the upside.
• I think the inflation we are seeing is very bad for low and moderate-income households. Real wages are declining. People are unhappy. Consumer confidence is declining. This is not a good situation.

Question of the Day

Precisely what credibility does the Fed have to maintain?

For example, please note New York Fed Concludes Underlying Inflation Is Only 4.6%.

Meanwhile, "Government in Sunshine" Emergency Fed Meeting on Monday to Discuss Inflation. 

Let's see what they have to say, if indeed anything.