Fed toying with recession, rate cut could happen, Bullard says
One of the US central bank's most 'dovish' rate-setters argued against further monetary policy tightening, warning that it was toying with possibly pushing the economy into recession.
In an interview with the Journal, Federal Reserve bank President, James Bullard, said: "We've got a good level of the policy rate today."
He went on to add that the Federal Reserve was "bordering on going too far and possibly tipping the economy into recession."
Bullard believed bond yields were signaling that there might be some recession risk ahead if policymakers continued to push rates up.
"If the economy slowed down more than we thought, or the inflation outlook deteriorated more than I’m suggesting here, there might be grounds for a little bit lower (federal funds) rate in that scenario."