St. Louis Fed president addresses rising inflation

Arkansas Business, June 23, 2008 by Katie Stockstill

James Bullard, president of the Federal Reserve Bank of St. Louis, addressed northwest Arkansas professionals during the Quarterly Business Analysis breakfast on June 4 at the Embassy Suites in Rogers.

During his speech, Bullard, who took over as president in April, gave his perspective on the U.S. economy and the issues and trends affecting monetary policy.

Bullard said the Fed's early and continued concentration on the nation's financial sector has addressed some of the industry's major issues and put the central bank in the position to begin addressing the nation's rising inflation.

"After a 10-month period in which the dominant policy concern has rightly been the state of financial markets, policy can begin to address pressing inflationary concerns during the remainder of the year," he said.

Bullard said he believes the central bank will be able to maintain price stability by focusing on the longer-term behavior of the inflation rate and, as a result, the nation will continue to see growth for the rest of 2008.

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"My sense is that the U.S. economy will be able to post stronger growth in the second hall of this year despite the ongoing financial crisis and the drag from the housing sector," he said.

When asked about continued banking issues within the Eighth District, Bullard said he understood that banks were under a great amount of pressure but believed that all the banks in the district would be able to "weather the storm."

The Quarterly Business Analysis is hosted and presented by the Center for Business & Economic Research at the University of Arkansas' Walton College of Business.