On Friday, John Williams, President of the New York Federal Reserve Bank, indicated that the series of interest rate hikes by the US central bank may be nearing its end. However, he noted that high rates will continue to be a part of the strategy to achieve a 2% inflation target. These remarks were made public despite the cancellation of his scheduled event in Long Island.
The benchmark interest rate is currently at a 22-year high, ranging between 5.25% and 5.5%. This comes as part of the Federal Reserve’s aggressive tightening campaign, with 12 out of 19 Fed officials predicting another hike within this year.
Despite these increases, Williams anticipates an inflation rise of 3.25% for this year. He also projected fewer cuts in 2024 and an unemployment rate exceeding 4%. This forecast comes in light of recent data showing the slowest monthly inflation pace since late 2020, leading to speculation that the Federal Reserve’s inflation projections may have been too high and thus making another hike less probable.
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