Fed's Williams: Fed needs more rate rises to cool inflation

Reuters reported that Federal Reserve Bank of New York President John Williams said on Thursday the U.S. central bank has more rate hikes ahead and sees signs inflationary pressures might be starting to cool off from torrid levels.

“With inflation still high and indications of continued supply-demand imbalances, it is clear that monetary policy still has more work to do to bring inflation down to our 2% goal on a sustained basis,” Williams said in the text of a speech to be delivered before the Fixed Income Analysts Society in New York.

“Bringing inflation down is likely to require a period of below-trend growth and some softening of labor market conditions,” Williams warned.

Key comments and notes

US inflation still too high, the Fed has more work to do on rate rises.
    
Lowering inflation will need period of slower growth, softer job market.
    
Fed must stay the course until inflation is brought back to 2%.
    
Balance sheet reduction is going well.
    
Williams sees signs inflation pressures starting to moderate.
    
 Williams expects inflation to cool to 3% this year.
    
Williams expects u.s. growth of 1% this year.
    
He expects US Unemployment to rise to 4.5% this year.

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