U.S. Fed has struggled to respond to economic realities: Fed’s Bullard
(Reuters) – The head of a Federal Reserve branch known for its out-of-the-box theories said on Thursday the U.S. central bank has struggled in the last few years to respond to economic realities and should better embrace what he called “frontier research.”
James Bullard, president of the Federal Reserve Bank of St. Louis, did not comment on current monetary policy or the economy in remarks to a conference here.
“The Fed and central banks around the world have struggled to devise appropriate policy responses to the current macroeconomic situation” in the past few years, he said according to prepared remarks.
“Advanced economic theory has to be made more relevant for actual policy, and actual policy has to understand and embrace the difficult ideas advanced in the theoretical world.”
Bullard is usually seen as a policy centrist, but has become one of the central bank’s most vocal doves due to concern that inflation remains too far beneath the Fed’s goal of 2 percent, which he worries could lead to damaging deflation.
