Fed´s Bullard leans toward December rate hike

A top US central banker said he was leaning towards a rate hike when monetary policymakers next met, in December, and welcomed the rise in bond yields and inflation expectations since Donald Trump´s election victory.

Speaking at a banking conference in Frankfurt, Germany, the president of the Federal Reserve bank of St.Louis, James Bullard, said: "Markets are currently [factoring in a] high probability of a December move, I’m leaning toward supporting that”.

“The question now is about 2017.”

For Bullard, the recent rise in yields was a positive sign.

“The 10-year bond yield has come up since the election, that’s been a sharp move, but the [...] yield is only about the level it was when the Fed moved in December of last year [...] So far so good, if we’ve raised inflation expectations back to more natural levels,” he explained.

Bullard also sounded a positive note on plans by Trump to incentivise US corporates to repatriate profits.

He also reiterated his view that the impact from changes to trade or immigration policies would only impact the economy in the long-run.