New York Fed Chairman John Williams said today that he expects the US economy to slow down amid tightening Fed monetary policy in the coming months, but added that the US can avoid a recession.
“The recession is not my main scenario right now,” Williams said in an interview with CNBC. “I think the economy is strong,” he added.
However, he estimated that growth will slow down considerably, noting that “this will be a slowdown we want to see” in order to reduce inflationary pressures.
The official also noted that the Fed should raise interest rates on a restrictive trajectory next year. In this context, he estimated that the Fed’s key interest rate may reach 4% sometime next year.
For this year, the Fed should raise its interest rate to 3.5%, he said, forecasting a 50 or 75 basis point increase at the next bank monetary policy meeting.
At its last meeting, the Fed raised its interest rate by 75 basis points. making the biggest increase since 1994, to bring it to 1.5% to 1.75%.
Source: Capital
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.