MNI POLICY: US GDP May Recover This Yr, Still Need QE- Bullard

The U.S. economy could make a full recovery by the end of this year, St. Louis Federal Reserve President James Bullard said Thursday, but it's too soon to discuss scaling back asset purchases.

Cementing his place as perhaps the most bullish member of the Federal Open Market Committee, Bullard said during a webinar he was surprised by the economy's strength despite the pandemic--and with the unemployment rate still at 8.4%.

"There is an outside chance that U.S. GDP could reach the 2019 average level by the end of 2020, a form of 'full recovery,'" Bullard said.

Despite his optimism, Bullard said the Fed's new policy framework and forward guidance intimated that no change in interest rates or asset purchases would be needed in the near future.

"It's premature to start thinking about anything like that," he told reporters when asked about a possible reduction of bond buys.

He said the Fed refrained from including hints about the path of its bond purchases in its forward guidance issued this month because "QE policy is less agreed upon--there's a wider dispersion."