Williams Sees 4% Inflation Peaking in Months as Fed Lets Data Drive Rates
Updated
Updated · vtmarkets.com · May 28
Williams Sees 4% Inflation Peaking in Months as Fed Lets Data Drive Rates
3 articles · Updated · vtmarkets.com · May 28
Summary
Inflation near 4% and core inflation around 3% should see their tariff- and energy-driven boost peak in the next few months, New York Fed President John Williams said.
Williams said future Fed moves will depend on incoming data, the evolving outlook and risk balance, while warning that persistently high inflation would require higher rates.
The Middle East war remains a risk through energy prices and supply chains, though he said the US is less vulnerable to oil shocks than in the past and any energy inflation hit should be short-lived.
He also described the economy as solid, the labor market as performing well and productivity as improving even before AI, which he expects to add a lasting boost.
Long-term inflation expectations remain stable even as near-term measures are elevated, reinforcing the Fed's focus on keeping expectations anchored.