WASHINGTON (MarketWatch) -- The recent run-up in gold and oil prices is not inflationary, said James Bullard, the president of St. Louis Federal Reserve Bank of St. Louis, in a CNBC television interview Wednesday. Bullard said the Fed generally would not like to start tightening monetary policy until the unemployment rate starts down. One tightening strategy the Fed may employ would be to hold interest rates low while selling assets to lower bank reserves, Bullard said. "That would be one way to get started," Bullard said. If inflation expectations move up sharply, "that is going to trump everything and the Fed is going to have to come in and take care of that, he said. Bullard said the Fed should leave its asset purchase plan open in order to give the central bank flexibility next year.