The Federal Reserve may have to raise its benchmark interest rate much higher than it has previously projected to get inflation under control, James Bullard, who leads the Federal Reserve Bank of St. Louis, said Thursday.
Bullard's comments raised the prospect that the Fed's rate hikes will make borrowing by consumers and businesses even costlier and further heighten the risk of recession. Wall Street traders registered their concern by sending stock market futures further into the red early Thursday. The Dow Jones Industrial Average was down about 330 points shortly before trading began.
