Fed Must be Resolute and We Cannot Fall Short says NY Fed Williams

The New York Fed president John Williams, who is a voting member was speaking at a campus of the University of Puerto Rico continued with his hawkish tilt. He also focused on familiar themes saying and risks to the inflation outlook are particularly acute. His prepared speech followed a strong US jobs report for June and the release of the last FOMC minutes.

The Fed holds around US$9 trillion of Treasury bonds and mortgage-backed securities.

Federal Reserve Bank of New York President John Williams spoke at a campus of the University of Puerto Rico.

Discussion Highlights

  • Strongly Committed’ To Returning Inflation To 2%
  • Inflation is sky-high, and it is the number one danger to the overall health and stability of a well-functioning economy
  • I want to be clear: this is not an easy task. We must be resolute, and we cannot fall short.
  • Unemployment Seen Rising To Somewhat Above 4% Next Year
  • GDP Growth Seen Below 1% In 2022, Around 1.5% In 2023
  • 75Bps Hike In June Was A Critical Step
  • Note in the prepared remarks did not address whether he favored a 0.75 percentage point increase at the Fed’s upcoming July meeting, something several Fed members have already endorsed.
  • Fed Has Tools To Get Job Done, Reiterates 100% Commitment
  • To Watch Data to Determine ‘How High Or Fast To Hike
  • How the economy responds to tightening financial conditions and how inflation, inflation expectations, and the economic outlook evolve.

Today’s comments were in along with comments that Fed officials are focused on reducing inflation without wrecking the economy.

New inflation data will be released next week, May consumer price index was rising at a more than 8% annual rate and Core PCE, preferred by the Fed, was increasing more than 6%.

A strong June jobs report showed the jobless rate at 3.6% for the fourth month in a row was released this morning.

Source: Reuters

From The TradersCommunity US News Desk