Deniz 
In a statement, New York FED President John Williams recently expressed his opinions on the state of the economy. Although he admitted that inflation is still somewhat high, he said he thought it would calm down later this year.
Williams pointed out that there is a lot of data showing that monetary policy is constrictive and that inflation reduction has not lately advanced. He nonetheless underlined that the FED will keep looking over all the evidence in order to decide on monetary policy with knowledge.
According to him, monetary policy still puts restrictions on economic growth. Still, he thinks the hazards to the FED’s mandates are shifting toward a better equilibrium. He also voiced hope that the FED’s approach will help bring inflation back to the 2% target.
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Williams projected a modest trend for the second half of 2024, even though she acknowledged that inflation is still somewhat high. Furthermore, he noted that pay rises were still too high in relation to the 2% inflation target.
Positively, Williams noted that inflation projections remain steady and that the economy is approaching a better equilibrium. This year, he predicts the economy to expand by 2%–2.5% and the unemployment rate to be at 4% by year’s end. Inflation will also reach 2.5% this year and approach 2% next year, he also forecasts.
Declaring his happiness with the present level of monetary policy, Williams said it is evident the FED is working as expected. Though there is no hurry to move on monetary policy, he pointed out that eventually interest rates would have to drop.
He explained that the FED can reduce interest rates without precisely matching the inflation rate. Williams notes that rate increases are not part of the baseline projection and predicts that by early 2026, inflation will hit 2%.