St. Louis Fed President James Bullard said “I don’t have any reason to doubt the economy will slow in 2019 and 2020. It would be much tougher for the Fed to continue to raise at this pace in a slowing economy relative to where we have been.”
He also warned that “the good news won’t last forever, and if potential growth really is at 1.8 percent the economy is going to return to some level more like that.” He added, “the question in my mind is what are we trying to control? We have already been preemptive…We took all this action and it has put us in good shape.”
And, “if we had not had these surprises to the upside my story would have looked better in retrospect than it does,” Bullard said. “As a baseline most forecasts have the economy slowing down…That is the basic structure we are working with going into 2019.”
