Fed's Bullard says further rate hikes will restrict growth

(Reuters) - St. Louis Federal Reserve Bank President James Bullard on Wednesday said he believes the Fed's policy rate is "pretty close" to neutral, and that further rate hikes would act to slow economic growth and push downward on inflation.

"If we start going up from here we are going to get into restrictive territory," Bullard said in a Bloomberg Television interview. "Do we really want to do that when inflation expectations are already hovering below our target for the next five years?" Most of Bullard's colleagues believe at least two more rates hikes are appropriate this year, given that unemployment is at 3.9 percent and inflation is edging up toward the Fed's 2-percent target.

(Reporting by Ann Saphir; Editing by Chizu Nomiyama)