St. Louis Fed president James Bullard highlighted the need for the central bank to intervene in forty-year record inflation, noting “we’ve been surprised to the upside of inflation.”
Bullard’s statements come as the Fed has already announced it will begin rate hikes in early March to combat inflation, which rose to 7.5% in January, its highest level since 1982.
“The inflation that we’re seeing is very bad for low- and moderate-income households,” said Bullard to CNBC. “People are unhappy, consumer confidence is declining. This is not a good situation. We have to reassure people that we’re going to defend our inflation target and we’re going to get back to 2%.”
Gasoline prices which rose 40% year-over-year have been mentioned by analysts as a key factor in the approval ratings of president Joe Biden with 53% of US citizens disapproving of his job performance this February up from 37% one year ago.