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"Zero is no longer the appropriate interest rate
for the U.S. economy," Bullard said during a panel session at
London City Week.
Monetary policy would still be "extremely accommodative" even if
the central bank began with a small increase in rates "sometime
in the summer," he added.
The Fed is inching towards its first interest rate hike in
almost a decade. Analysts are trying to guess its timing, having
pushed back expectations last week after Fed chair Janet Yellen
raised concerns about the dollar's recent strength.
Bullard, one of the central bank's long-time advocates of slowly
raising rates, said that with the United States economy expected
to grow at over three percent and inflation being pushed lower
by uncontrollable factors, the time was right.
Removing the word 'patient' with reference to rate increases
from the Fed's policy statement last week was also an important
move.
He said it would give the Fed "more optionality" and allow it to
make decisions "meeting by meeting" based on the strength of
economic data.
(Reporting by Marc Jones and Huw Jones; editing by John
Stonestreet)
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