The Strategist

New York Fed Chief: Current base rate is satisfactory

09/11/2023 - 03:45

John Williams, the president of the Federal Reserve Bank of New York, expressed satisfaction with the progress made in bringing down the country's inflation rate and said the Fed will keep an eye on new statistical information before deciding whether to raise or hold the key interest rate.
"Monetary policy is currently operating at a very high level. The anticipated outcome has been achieved. We'll keep an eye on the data moving forward and consider whether the policy is tight enough or whether we need to hike the rate once more," Williams told MarketWatch.

The Fed’s rate is currently between 5.25 and 5.5%. The majority of analysts and market participants are almost positive that the central bank won't change the rate during its upcoming meeting on September 19–20. While some think the tightening cycle has already come to an end, others anticipate another increase in November or December.

Williams added that the likelihood of a US recession has diminished. He predicts that the country's unemployment rate will increase from its current level of 3.8% to roughly 4%.