Fed’s Williams said he’s ‘very focused’ on getting inflation back to target

Date:

Share post:



Like a lunar rocket, inflation has shot up and come back down but has yet to land safely, New York Fed President John Williams said Wednesday.

“While we’ve seen great progress toward achieving our goals, the journey is not yet over, and I am very focused on making sure we complete this mission successfully,” Williams said in a speech at an aviation museum on Long Island.

“We still have a ways to go on the journey to sustained 2% inflation,” he added.

Williams said the New York Fed’s measure of core inflation, called the Multivariate Core Trend Inflation, is running at 2.3% annual rate in December, down from 5.5% in June 2022.

Williams said there are likely to be “bumps” along the way. Still, he expects the Fed’s favorite inflation measure, the personal consumption expenditure price index, will fall to a range of 2%-2.25% this year. That’s a slight improvement from December when Williams forecast a 2.25% inflation rate this year. Williams said he sees PCE inflation at 2% in 2025.

Williams said he expects U.S. GDP to slow to about 1.5% annual rate this year, down from a 2.5% rate in 2023. The unemployment may rise modestly to about 4%, he added. Williams said the current unemployment rate of 3.7% was near his estimate for how low the unemployment rate can be without putting upward pressure on inflation.

“In summary, the economy is strong, imbalances and diminishing and inflation has come down but remains above our 2% longer-run target,” Williams said.

What does that mean for monetary policy?

In a recent interview with Axios, Williams said he thought the Fed could start to cut interest rates later this year.

Williams said there were risks that inflation might surprise on the upside. But at the same time, the economy might falter if consumers pull back unexpectedly.

Stocks
DJIA

SPX
were lower in early afternoon trading while the 10-year Treasury note yield
BX:TMUBMUSD10Y
slipped to 4.89%.



Source link

Alexandra Williams
Alexandra Williams
Alexandra Williams is a writer and editor. Angeles. She writes about politics, art, and culture for LinkDaddy News.

Recent posts

Related articles

Fresh uncertainty around Fed rate cuts exposes the stock market’s winners and losers

Higher U.S. inflation is dashing investors’ hopes for multiple Federal Reserve rate cuts this year, while opening...

Shohei Ohtani not involved in gambling, prosecutors say, as they charge translator with stealing $16 million

Baseball star Shohei Ohtani was not involved in gambling and had no knowledge of payments being made...

Stocks, bonds slump as traders shift Fed rate-cut expectations to September

Markets were rattled Wednesday by a stronger-than-expected inflation report, with stocks and bonds selling off as investors...

Philips shares climb after finalizing pact with U.S. over device sales

Philips reiterated its financial outlook on Wednesday after finalizing a consent degree with the U.S. Department of...

GOP says Biden administration is using crypto as a ‘scapegoat’ for foreign-policy failures

The digital-asset industry and its allies in Congress on Tuesday criticized the Biden administration for blaming cryptocurrency...

States sue over Biden’s student-loan repayment program using arguments that succeeded before

Missouri and six other states are asking a court to block the Biden administration’s revamped student-loan repayment...

Congressional push to take TikTok off your phone may ‘be lost in the fog of presidential politics,’ Pence says

Senate Minority Leader Mitch McConnell and former Vice President Mike Pence are throwing their support behind a...

A $1,400 SUV payment? A $1,600 truck payment? Sounds ‘absurd,’ but it’s becoming more common.

A TikTok user says she has two massive car payments every month: one for her Chevy Tahoe...