Federal Reserve Bank of St. Louis President Jim Bullard projected on Monday the United States will have a “strong labor market” in “months and quarters ahead” as the country’s gross domestic product (GDP) is observing a growth of almost 7%.
Bullard noted the current situation in the market is “very tight” as the public is seeking “more flexible working conditions” amid the still ongoing COVID-19 pandemic. He remarked the latest statistics show the “unemployment-vacancy ratio” is at 1.1%, which “doesn’t sound pretty good.” Still, Bullard pointed out that “we are not in a situation when the economy is very weak.”
Bullard added the output, particularly inflation, is still exposed to a “lot of risk” but noted the expectations are rising amid the accelerated rollout of vaccines against COVID-19. He said the Fed is expecting core personal consumption expenditures (PCE) inflation to come in at 2.5% in 2022 while stressing that the institution “needs to be ready to react on both sides of that and stay nimble.”