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27 Feb 2015
Fed's Williams: Maybe in June time to contemplate raising rates
FXStreet (Bali) - Federal Reserve Bank of San Francisco President John Williams made some unambiguously hawkish comments, leaving the door open to raise interest rates anytime from mid-June, following an interview with the Wall Street Journal.
Key Quotes - WSJ
In an interview with The Wall Street Journal, Mr. Williams expressed a good deal of confidence in the U.S. outlook, especially on hiring. He said the jobless rate could fall to 5% by the end of the year, which means the central bank is getting closer to boosting its benchmark short-term interest rate from near zero, where it has been since the end of 2008."
“We are coming at this from a position of strength,” Mr. Williams said. “As we collect more data through this spring, as we get to June or later, I think in my own view we’ll be coming closer to saying there are a constellation of factors in place” to make a call on rate increases, he said.
“I don’t see any reason at all that we should raise rates before June. That’s out,” he said. “Maybe in June it would be the time to contemplate raising rates. Maybe we’ll want to wait longer, but at least it will be an option to decide on,” he said. The Fed has a scheduled policy meeting June 16-17.
Mr. Williams said he would like the Fed to drop its commitment to be “patient” in deciding when to raise rates because it limits the central bank’s options on when to move. “You would want to remove the patient language only to have the ability to make those data-dependent decisions later in the year,” he said.
Key Quotes - WSJ
In an interview with The Wall Street Journal, Mr. Williams expressed a good deal of confidence in the U.S. outlook, especially on hiring. He said the jobless rate could fall to 5% by the end of the year, which means the central bank is getting closer to boosting its benchmark short-term interest rate from near zero, where it has been since the end of 2008."
“We are coming at this from a position of strength,” Mr. Williams said. “As we collect more data through this spring, as we get to June or later, I think in my own view we’ll be coming closer to saying there are a constellation of factors in place” to make a call on rate increases, he said.
“I don’t see any reason at all that we should raise rates before June. That’s out,” he said. “Maybe in June it would be the time to contemplate raising rates. Maybe we’ll want to wait longer, but at least it will be an option to decide on,” he said. The Fed has a scheduled policy meeting June 16-17.
Mr. Williams said he would like the Fed to drop its commitment to be “patient” in deciding when to raise rates because it limits the central bank’s options on when to move. “You would want to remove the patient language only to have the ability to make those data-dependent decisions later in the year,” he said.