Fed's Williams says he doesn't feel 'urgency' to cut rates

By Greg Robb

Interest rates need to be lower 'at some point,' New York Fed president says

The Federal Reserve's benchmark interest rate is in a "good place," moving inflation down gradually, and there is no need to rush to push the rate lower, New York Fed President John Williams said Thursday.

"I definitely don't feel urgency to cut interest rates," Williams said in a talk sponsored by Semaphore.

"I think monetary policy is doing exactly what we'd like to see," he added.

Asked if the next move by the Fed might be to raise interest rates, Williams said he would never say never, but a rate hike was not his base case.

"Eventually, at some point, we would want to lower interest rates as the economy really gets into the 2% inflation that we're headed towards," he said.

"The timing of that is driven by the economy," Williams added.

Recent economic data has shown a strong labor market, GDP growth and spending.

Progress on inflation "has been a little bit of a bumpy road, but overall the trend is that inflation is gradually coming down," he said.

Earlier this week, Federal Reserve Chair Jerome Powell suggested that rates will need to be higher for longer.

The Fed has said it wanted to have greater confidence in the low inflation trend before it would be appropriate to cut rates.

"The recent data have clearly not given us greater confidence and instead indicate that it's likely to take longer than expected to achieve that confidence," Powell said.

The 10-year Treasury note yield BX:TMUBMUSD10Ymoved up to 4.633% in morning trading.

-Greg Robb

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04-18-24 1007ET

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