Investing.com - Federal Reserve (Fed) Bank of St. Louis President James Bullard repeated his view on Monday that interest rates were likely to remain low for the next two to three years.
Bullard noted in his speech at the fall conference of the Association for University Business and Economic Research (AUBER) that the view of the St. Louis Fed on the rate path projection was “much flatter” than the rest of the Fed.
“Low interest rates are likely to continue to be the norm over the next two to three years,” Bullard said.
In the speech, the St. Louis Fed chief noted that the reasons behind the extremely low real rate of return on safe assets were a subject of wide debate.
“Real safe rates of return are exceptionally low at present and are not expected to rise soon,” he said.
“This means, in turn, that the policy rate should be expected to remain exceptionally low over the forecast horizon,” he concluded.
Bullard, who does have a vote on policy decisions this year, has said in the past that he is the most dovish of the Fed policymakers and clarified that he was the member on the dot plot that foresaw just one rate hike with no further increases over the rest of the Fed’s projection horizon.
Despite the upcoming policy decision meeting on November 1 and 2, markets place their bets on a move in December with the odds at 69.2%, according to Investing.com’s Fed Rate Monitor Tool.