In a speech, New York Fed President John Williams said he expects the FOMC to “move expeditiously in bringing the federal funds rate back to more normal levels this year”. The ongoing pandemic and Ukraine war “bring a tremendous amount of complexity and uncertainty”. Fed will “need to be data dependent and adjust our policy actions as circumstances warrant.”.
For 2022, Williams expects core inflation to be nearly 4%, before falling to around 2.50% next year, then further decline to close to 2% long-run goal in 2024. He also expects GDP growth to be around 2% in 2022 while unemployment rate to remain around its current low level.
