St. Louis Fed President James Bullard tried to down play recent rise in core inflation, where core CPI rose above 2% to 2.1% in March. Bullard said “year-over-year core CPI is now above 2 percent but it was also above 2 percent all during 2016, and so it’s really only come back to the level that it was in that earlier period when interest rates were much lower.” And to him, “those developments so far have been unsurprising.”
Regarding trade tensions, Bullard said there is too much uncertainty around the tariffs to assess the impact for now. But he hoped that US and China will get a good outcome on trade.
Regarding exchange rates, Bullard said growth growth has been surprising, in particular in Europe. Such strength wasn’t priced in and thus, led to dollar weakness.
