Bullard Urges Front-Loading Rate Hikes to Boost Fed Credibility (As Flexible Price Inflation Hits 20.13%)

Federal Reserve Bank of St. Louis President James Bullard said he favors a strategy of “front-loading” big interest-rate hikes, and repeated he wants to end the year at 3.75% to 4% to counter the hottest inflation in four decades.

“We still have some ways to go here to get to restrictive monetary policy,” Bullard said in a CNBC interview Tuesday.

“I’ve argued now with the hotter inflation numbers in the spring, we should get to 3.75% to 4% this year. Exactly whether you want to do that at a particular meeting or some other meeting is a great question. I’ve liked front-loading. I think it enhances our inflation-fighting credentials.”

Federal Reserve presidents including Bullard speaking this week emphasized that inflation at a 40-year high has yet to slow, and pushed back against the perception the central bank was pivoting to a less aggressive phase of tightening monetary policy. Fed Chair Jerome Powell last week cited Federal Open Market Committee forecasts that the Fed would raise rates to 3.4% at the end of the year and 3.8% in 2023.

Bullard wants to raise rates to boost Fed credibility?? When flexible price inflation is at 20.13% and The Fed is awfully slow to shrink their balance sheet??? What credibility is he talking about????