The president of the Federal Reserve Bank of St. Louis predicted that 2014 GDP growth will exceed 3 percent, unemployment will reach 6.2 percent during the fourth quarter, and inflation will reach 1.6 percent. Jim Bullard, at an economic forum in Indianapolis, noted that he was wrong about his prediction last January of 3.2 percent GDP growth in 2013, due mainly to the first quarter of 2013. GDP growth remained below 3 percent.
Bullard also noted that forecasts made by the Fed’s policy-making Federal Open Market Committee (FOMC), on which he currently sits, are often misunderstood. Each FOMC participant submits a forecast based on that participant’s view of an “appropriate monetary policy.” That means that each of the participants may be using different economic assumptions in the forecasts.