Wednesday, February 18, 2009

Fed: "US Facing Risk of Sustained Deflation"

Fed’s Bullard: U.S. Facing Risk of Sustained Deflation

The rising threat of deflation in the U.S. economy means the central bank needs to take unambiguous steps to counter expectations of falling prices, a central bank official said Tuesday.

“We face some risk - at this point only a risk - of sustained deflation,” in an environment where core inflation is already running “at zero to slightly negative rates,” Federal Reserve Bank of St. Louis President James Bullard said.


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