Fed’s Bullard: His projection has rates reaching 5.375%

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Bullard puts the Awk in Hawk – If he’s ‘only’ looking for 5.375%, Mr Market is WAYYYYY too hawkish

Reuters on Bullard

Fed’s Bullard on the Wires:

U.S. ECONOMY IS STRONGER THAN WHAT WE PREVIOUSLY THOUGHT

FED WILL HAVE TO GO NORTH OF 5% TO TAME INFLATION

WE’VE GOT A LITTLE WAYS TO GO

STILL THINK WE CAN GET INFLATION DOWN WHILE MAINTAINING A STRONG LABOR MARKET

STILL IN A LOW PRODUCTIVITY GROWTH REGIME

FED SHOULD ONLY SLOW DOWN ONCE IT’S GOT TO THE TERMINAL RATE

MARKETS MAY BE OVERPRICING RISK OF RECESSION IN 2023

I FORECAST MODERATELY SLOW GROWTH THIS YEAR WITH INFLATION DECLINING

IF IT DOESN’T THEN WE WILL HAVE TO ACT

THAT’S WHY FED NEEDS TO BE SHARP NOW AND GET INFLATION UNDER CONTROL THIS YEAR

THIS IS THE AGE OF FORWARD GUIDANCE, SO ECONOMIC LAGS ARGUMENTS MAKE LESS SENSE NOW

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