WORLD

Bullard says world well prepared for U.S. rate hike

By 임정요
  • Published : May 30, 2016 - 10:47
  • Updated : May 30, 2016 - 11:14

The president of the U.S. Federal Reserve Bank of St. Louis hinted at a possible U.S. rate hike in the near future Monday, claiming the world is well prepared for a U.S. rate hike.

"My sense is that markets are well prepared for a possible rate increase globally," James Bullard told reporters here. "My idea is that if all goes well, this will come out smoothly, and you won't get too much of a reaction in the global financial market."

The St. Louis FRB president was on a visit to attend an international conference hosted by the Bank of Korea.

Bullard insisted such an outlook was not "too surprising" given that a U.S. rate hike in December, the first of its kind in nearly a decade, did not cause too big of a disturbance.

However, a U.S. rate hike often leads to capital flights from newly emerging markets, and the December hike was clearly not an exception, at least in South Korea, where foreign investors dumped nearly 8 trillion won ($6.72 billion) worth of local shares in the longest selling streak recorded here.

Any future decision on the U.S. rate will depend on data, Bullard insisted, adding no decision has been made and any rate decision in the future will remain data-dependent.

"I think the FED's policy continues to be that we are data-dependent. We reserve the right to make a decision at a meeting," he said.

Bullard is one of 12 current members of the Federal Open Market Committee. He is one of four Reserve Bank presidents serving a one-year term on the FOMC this year.

When asked about the direction of the FED's monetary policies following the U.S. presidential election this year, the St. Louis FRB president said the FED remains independent.

"We resist attempts to politicize the process either from the Democratic or the Republican side," he said. "An independent FED serves world interests much better." (Yonhap)