Inflation Will Likely Come Down to 3%, New York Fed President Says: What You Need to Know
Is inflation finally cooling off? New York Fed President John Williams believes so, but emphasizes that "The Central Bank has much more to do in order to bring inflation back down to 3%," as he stated on Monday. His comments come as economists and consumers alike are closely watching inflation trends, hoping for relief from persistent price pressures.
NY Fed President John Williams on Inflation\'s Trajectory
NY Fed President John Williams spoke to the NEW YORK media, offering insights into the Federal Reserve\'s outlook. While acknowledging the progress made, he stressed the ongoing commitment to achieving the target inflation rate. Mr. Williams also said in his speech that falling inflation pressures are likely to see inflation ease to 2.25 per cent this year and to just above 2 per cent next year.
Consumer Expectations and the PCE Index
Inflation as measured through the Fed’s preferred yardstick—the personal consumption expenditures (PCE) price index—is expected to come in at 2.7% for April, according to Hace 2 días. This suggests a gradual moderation in inflation, although still above the Fed\'s desired target. According to the New York Fed’s monthly Survey of Consumer Expectations, one- and three-year-ahead inflation expectations rose as inflation surged. Since then, these expectations have fluctuated, reflecting the uncertainty surrounding the economic outlook. The Federal Reserve Bank of New York’s Center for Microeconomic Data today released the April 2025 Survey of Consumer Expectations, which provides further details on these consumer perceptions.
The Fed\'s Balancing Act
New York Fed President John Williams said the central bank had made “tremendous progress” toward balancing its goals of reducing inflation while promoting a healthy economy. The Fed is not facing any economic trade-off just yet, bolstering officials’ confidence that they can afford to be patient about rate cuts. At the May meeting, Jerome H. Powell, the Chairman, reiterated the commitment to data-dependent decision-making.
Historical Context and Future Outlook
As measured by the personal consumption expenditures (PCE) price index, inflation surged to a 40-year high of just over 7 percent in June of last year. Since then, we\'ve seen some moderation, but the journey back to the 3% target is expected to be gradual. John Williams, president and chief executive officer of the Federal Reserve Bank of New York, said on Thursday that inflation is still too high but could start slowing down 6 de sept. de 2025
Key Takeaways:
- New York Fed President John Williams anticipates inflation easing towards 3%, but emphasizes the need for further action.
- The PCE price index, the Fed\'s preferred inflation measure, is expected to show continued moderation.
- Consumer expectations regarding inflation remain a crucial factor in the Fed\'s policy decisions.
Stay tuned for further updates as the Federal Reserve navigates the complex landscape of inflation and economic growth.