Lates News

New York Fed President Williams reiterated that monetary policy is still in a favorable position to deal with the threat of long-term supply shocks caused by the Middle East war. This shock could push up inflation and suppress growth. He stated that if energy disruptions are quickly relieved and the conflict impact is reversed this year, or partially reversed, but a prolonged crisis would bring more serious consequences. The war has pushed up inflation and suppressed economic activity through increased intermediate costs and commodity prices. Potential inflation is developing in the "right direction," but upward price pressures have spread to goods and services beyond energy, such as plane tickets, food, fertilizers, etc. Williams stated that the current monetary policy stance can balance the risks of employment and inflation goals. Several Fed officials have previously indicated that they are inclined to keep interest rates unchanged at the Washington meeting on April 28-29. Williams expects the US economy to grow by 2%-2.5% this year, with an unemployment rate of about 4.25%-4.5%, but labor market signals are contradictory; he also expects inflation to be between 2.75% and 3% this year, falling to 2% by 2027.