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Williams (Fed): US can avoid recession.

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

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