St. Louis Fed President James Bullard, a strong advocate of raising short-term rates at the Fed's September meeting, stuck to his guns Friday and argued the U.S. central bank needs to hike interest rates. In an interview on Sirius XM, Bullard said he disagreed with the market's gloomy outlook for the global economy and was upbeat about the outlook for the U.S. economy. He said the unemployment rate would drop to the 4% range over the next two years and said he was confident inflation was likely to return to the central bank's 2% target. Several alternate measures of inflation are closer to the target than the Fed's favorite inflation measure, he noted.
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