James Bullard, one of the most colorful figures among the Fed members, takes the floor again. The banker spoke about the "good" GDP report that was released yesterday. In his opinion, 7% growth can still be expected this year and the labor market should fully recover by next summer, which will be the basis for a rate hike! In his opinion, the labor market will return to normal sooner, which should guarantee a reduction in the QE program already in the fall of this year. In his opinion, tapering should be fast and end in the early season in 2022, which could lead to the aforementioned interest rate increases.
The market sees a huge hawkish jump on Bullard's side, even bigger compared to a few weeks ago, which has led to clear moves in yields and the stock market. This time the decline in the stock market is related to other factors, but we see a deeper pullback on the EURUSD. It is worth remembering that Bullard is a voting member of the FOMC in 2022.
Source: xStation5
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