Fed’s bullard says tax overhaul may light fire under investment

Bloomberg

Federal Reserve Bank of St. Louis President James Bullard said President Donald Trump’s $1.5 trillion tax overhaul may spur investment and US economic growth, though policy makers can “wait and see” if that warrants higher interest rates because inflation is low.
“There is some possibility this could light a fire under investment and really drive growth higher,” Bullard, a policy dove who has argued against raising rates, said in a Bloomberg TV interview with Michael McKee. “If that happens I would certainly take note of that and adjust policy appropriately.” Bullard, attending the American Economic Association annual meeting in Philadelphia, said the US economy expanded by around 2.5 percent or slightly higher last year.
Trump last month signed into law the most extensive rewrite of the US tax code in 30 years, lowering taxes for corporations and most individuals.
“I have some sympathy for this idea you would get this investment boom coming out of this tax policy,” Bullard said.