August 12, 2021—Following several weeks of strong job growth across the country, one U.S. Federal Reserve official says it needs to start reining its stimulus contributions.
Coming on the heels of Friday's job report, which showed the economy added nearly 1 million new jobs, St. Louis Federal Reserve Bank President James Bullard told the Associated Press the economy has showed enough to warrant the Fed reducing its spending $120 billion a month on bonds. The purchasing is intended to lower longer-term interest rates and provide a jolt for the economy, which Bullard said is no longer necessary.
“It’s not clear to me that we’re really doing anything useful here,” Bullard said.
Bullard said the Fed should start tapering its purchases now and finish by next spring, which would lift its short-term interest rate and reduce rapidly rising inflation rates.
