St. Louis Fed President James Bullard expressed support for the Fed’s recent rate cut decision, stating that the reaction to this move in US bond markets points to bullishness in the US economy. Once the full impact of the three rate cuts of 2019 are felt, Bullard expects US GDP growth to rise above 2% in 2020.

Bullard remained hopeful that economic growth in the US could pick up as businesses adapt to the fallout of the US-China trade dispute and other reigning trade tensions in the markets. He made these comments under the assumption that tariff hikes will remain in place and that businesses will have to reform their supply chains towards achieving greater efficiencies.

Bullard also hinted that the Fed could take a wait and watch approach and keep interest rates steady in the near future to see how it would impact economic growth in the US. He made these remarks while speaking at the Rotary Club of Louisville, adding, “Key measures of the U.S. Treasury yield curve have now returned to a more normal, positive slope, possibly a bullish factor for 2020.”

He indicated that the Fed’s decision to cut interest rates thrice this year could actually prove more beneficial for the US economy’s health than previously anticipated. As per Bullard, “The bottom line is that U.S. monetary policy is considerably more accommodative today than it was as of late last year.”