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St. Louis Federal Reserve President James Bullard said the current level of U.S. price growth is significantly weaker than it should be if the Federal Federal Reserve had reached its two-percent inflation target and said the current inflation path since 2012 was worrisome.
The U.S. central bank official prices said prices in the economy are now 4.6 percent down from the price level course that was mapped out from 1995 to 2012, when inflation was rising toward the Fed's 2 percent target annually.
While the trend was not as severe as Japan's 1990s experience, he still noted it caused some worry.
Below-the-target inflationary pressures has kept U.S. central bankers from hiking rates by over three times since the Recession. However, since late 2016, majority of policymakers have seen faster rate of monetary policy tightening ahead given the noticeable improvement in the labor market.
Majority of Fed officials penciled in three interest rate hikes this year, including the one they made in March. However, Bullard said that a jump in inflation is still a narrow possibility even if the jobless rate further drops.
