Reiterates monetary policy 'well positioned' for current economy
Expects inflation to moderate to 3.5% this year
If Middle East war disruptions resolved soon, will lower inflation pressure
Williams expects inflation pressures to moderate
Thus far U.S. resilient against war economic impact
'Imperative' Fed get inflation back to 2% target
Sees U.S. growing at 2.25%, unemployment down to 4% in 2028
Standing repo operations key tool to cap interest rate pressure
Fed will adjust reserve management buying as needed
Middle East war continues to contribute risks and uncertainties
Job market has proved to be resilient
Williams has been more of a dove lately and isn't really sounding the alarm on inflation here. The 'imperative' part is notable though and suggests he's not going to support any rate cuts until he's highly confident on 2% inflation.
- Inflation is unquestionably elevated and well-above target
- In the coming quarters, I expect inflation to edge down
