Fed williams boxing meme
  • The question is: Have we gotten monetary policy to a sufficiently restrictive stance, that's what we're thinking about
  • We're focused on whether interest rates are in the right place
  • We aren't really talking about rate cuts right now
  • The base case is good, inflation is down
  • It's looking like we're at or near 'sufficiently restrictive' but things can change
  • We need to be ready to tighten further if progress on inflation were to stall
  • The market reaction to all kinds of news has had a pattern of being larger than normal
  • The view of the committee is a gradual removal of policy easing over the next three years
  • The market reaction has gone further than our predictions
  • If we get the progress I'm hoping to see, it will be natural to cut
  • Of course we need to move policy back to more-normal levels over a period of time
  • It's premature to be even thinking about March cuts
  • The question we're thinking about is 'do we have the level of rates right'
  • Right now we're seeing everything around QT and balance sheet working as intended
  • Not ready to say when balance sheet wind down stops
  • Financial conditions have tightened in the big picture (despite drop in 10y yields)

Williams is speaking in an exclusive interview with CNBC.

The market has reacted to him saying 'we're not really talking about rate cuts.' That doesn't really capture what he meant. He was indicating that they didn't talk about rate cuts at that meeting and were more talking about the path of their dots. In any case, the market has been a bit euphoric.

If you want to read exactly what Williams said and how it differs from Powell, read it here.

fed williams