Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

New York Fed's Williams: Fed has tools to deal with high inflation

Published 04/14/2021, 04:34 PM
Updated 04/14/2021, 04:35 PM
© Reuters. FILE PHOTO: John Williams, CEO of the Federal Reserve Bank of New York, speaks at an event in New York

© Reuters. FILE PHOTO: John Williams, CEO of the Federal Reserve Bank of New York, speaks at an event in New York

By Jonnelle Marte

NEW YORK (Reuters) - Inflation could be volatile in the near term as the economy recovers from the pandemic but overall price increases should remain subdued and the Federal Reserve knows how to act if inflation gets too high, New York Fed President John Williams (NYSE:WMB) said on Wednesday.

"We know how to deal with inflation," Williams said during a virtual conversation with Rutgers University students. He expects inflation overall to stay near the Fed's 2% target, he said.

"The economy is coming back pretty strong right now," as more Americans are vaccinated against the coronavirus and supported by robust fiscal aid, Williams said.

However, the Fed official noted that unemployment is still high and the economy still has a long ways to go as it recovers. Some businesses are also overcoming bottlenecks due to supply disruptions or higher demands for certain goods, Williams said, citing a sporting goods store he visited that is sold out of bicycles.

It's too soon to know how strongly travel will rebound or what share of people continue working from home, but some long-term damage may have been avoided, Williams said.

"There's a lot of things that are uncertain, but I think the economy will be able to get back to full strength," he said.

The pace of the economic recovery is accelerating and consumers are spending more on travel and other items, according to a report released Wednesday by the Fed. The economy in the New York Fed's district "grew at a strong pace for the first time during the pandemic," despite an increase in COVID-19 cases in the region, the regional bank reported.

© Reuters. FILE PHOTO: John Williams, CEO of the Federal Reserve Bank of New York, speaks at an event in New York

Williams said new variants of the virus are still a risk. "We’re a little bit in a race between the vaccinations and the new variants of the coronavirus," he said during the event.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.