(New York) An official of the American central bank (Fed) indicated Thursday that he saw “no urgency” to start lowering rates, given the good health of the economy in the United States, and the level still high inflation.
“I don’t feel any urgency or need to rush to make a decision now,” New York Fed President John Williams told the Economic Club of New York, believing “that things are going in the right direction.” direction “.
He also estimated that the current monetary policy, with very high rates, “is well positioned”.
“Given the data, I don’t feel the need to steer policy in one direction or another […] in the very short term,” added this official, who has voting rights within the Fed’s monetary policy committee, the FOMC.
Fed officials had, at their last meeting on April 30 and 1er May, worried about the rebound and the trajectory of inflation.
They had kept rates unchanged, at the highest in more than twenty years, between 5.25% and 5.50%. And had stressed that the time to start lowering them would come later than expected, with some members even prepared to raise them again if necessary.
Market players are mainly counting on September, or even November, for a first decline, according to the CME Group assessment.
Inflation had rebounded in early 2024, after a sharp slowdown in previous months, pushing the Fed to postpone the moment to lower rates.
The evolution of consumer prices in April, however, resumed its downward trajectory, to 3.4% over one year compared to 3.5% in March, according to the CPI index.
The Fed favors another measure, the PCE index, which also accelerated in March, to 2.7% over one year. April data will be released on Friday.
John Williams is counting on “early 2026” for a return to the 2% objective, he stressed.
Several Fed officials have insisted that the rebound in inflation encourages them to be cautious, and that rates risk remaining high for longer than expected.
A governor, Christopher Waller, however, estimated that “from now on, the probability is very low of having a rate increase” again.
The next Fed meeting will take place on June 11-12.