by Wolf Richter
Wolf Street
“Inflation could be a lot more persistent than we had hoped.”
Right after the Fed ends its asset purchases in the first half next year, the Fed should start reducing the assets on its balance sheet by letting maturing bonds roll off without replacement, said St. Louis Fed president James Bullard, a monetary-policy dove who will rotate into a voting slot next year, in an interview with Reuters.
“Everything can occur much faster than it could have in the previous recovery,” he said, pointing at economic output that already exceeds pre-pandemic levels.