St. Louis Fed President, James Bullard, sole dissenter in the Fed’s Wednesday decision hike rates by 0.25%, said the Fed should raise rates by at least 3% this year. He had argued on Wednesday that the 0.25% rate hike on Wednesday was insufficient.
He was joined in his assessment by Fed governor Christopher Waller who said the Fed may need to enact at least one 0.5% rate hike this year to get inflation under control.
“The data’s basically screaming at us to go 50, but the geopolitical events were telling you to go forward with caution,” Waller told CNBC. “So those two factors combined pushed me off of advocating for a 50 basis point hike and supporting the 25-point hike that we enacted.”
The US is currently seeing its highest level of inflation in 40 years at 7.9% year-over-year, with some forecasters predicting that it could go as high as 10%.
Food and energy prices are expected to rise strongly in April, as the full effects of the Russian invasion of Ukraine start t be felt.