Fed Williams Hint At Rate Cuts

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Fed Williams Hint At Rate Cuts

Fed Williams Hint At Rate Cuts In Late 2024

The NY Fed's president, John Williams, recently stated how the Federal Reserve will likely cut interest rates in 2024. His critical term was 'later this year', which doesn't give a timeline for when this could happen.

He added that the rate cuts are coming to the USA in 2024 despite a strong labour market and sticky inflation. This was revealed in an interview given to a third-party media outlet.

Us Economy On Path To 2% Inflation

Williams added that his view of the US economy is still the same and isn't dependent on data from just one month. He also added that the progress towards the % inflation goal of 2% can experience some roadblocks. However, he remains confident that it is heading in the right direction.

Against this backdrop, he said it makes sense to walk away from the restrictive monetary policy sometime later this year. Williams believes that his views are similar to those of the other members of the Federal Reserve. However, we are not hearing similar comments from other policymakers, and many need more confidence about rate cuts.

As Williams is the Fed's FOMC vice chair, his comments are significant. For now, the USA's interest rate is 5.25% to 5.50% and has remained unchanged since July 2023.

As for when the markets can expect a rate cut in 2024, no timetable was given. He also didn't mention which conditions would trigger the rate cuts in the USA. He only clearly mentioned that the economy was heading towards the inflation target of 2%.

Williams believes that inflation is coming down, and its pace is also consistent with the long-term goals of the Federal Reserve. He also believes one needs to look at the bigger picture by combining all the information to view the inflation trajectory.

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