Fed’s Williams says restrictive policy needed for a few years to bring down inflation
Federal Reserve Bank of San Francisco president reveals ‘direction of policy’
Federal Reserve Bank of San Francisco President and CEO Mary Daly provides insight on the Fed’s response to inflation on ‘Making Money.’
A senior Federal Reserve official said the central bank will need to keep monetary policy sufficiently restrictive for a few years to bring down inflation and realign supply and demand in the U.S. economy.
"To me, the important thing is we need a sufficiently restrictive stance, we need to retain a sufficiently restrictive stance of policy, we’re going to need to maintain that for a few years to make sure we get inflation to 2%, then eventually we’ll get interest rates presumably back to more normal levels," New York Fed President John Williams said at The Wall Street Journal’s CFO Network Summit in New York.
Fed officials last week approved lifting the benchmark federal-funds rate by a quarter-percentage point to a range between 4.5% and 4.75%. That was a slower pace than at prior meetings, they raised it by a half point in December and 0.75 point in November.