John Williams is open to lowering federal interest rates in September.
He sees the labor market as strong, with an unemployment rate of 4.2%.
The probability of a 25 basis point rate cut is expected to reach 88.2%.
John Williams, President of the Federal Reserve Bank of New York, stated during the bank's meeting in September that he does not mind lowering interest rates.
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Williams was speaking on CNBC about the possibility of successfully lowering interest rates if inflation continues to decline and the economy remains on the right track. This comes after Federal Reserve Chair Jerome Powell hinted at the Jackson Hole conference last week about the possibility of lowering interest rates soon.
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Williams pointed out that current interest rates are somewhat tight, so there is room to lower them while keeping things under control. He said they will look at the latest inflation and employment figures to determine what is most appropriate.
Some believe that the labor market has become unstable, but Williams is not convinced, noting that the unemployment rate remains steady at 4.2%. Williams does not think it is right to panic just because last month's jobs report was weaker than expected.
As a voting member of the Federal Open Market Committee, Williams may have an influential opinion at the meeting on September 16-17. Powell spoke about increasing job risks, but Williams seems less worried. According to CME FedWatch, there is an 88.2% chance of a 25 basis point rate cut next month.
Meanwhile, President Donald Trump is strongly insisting on lowering interest rates and even attempted to dismiss Lisa Cook, a Federal Reserve governor. But Cook opposes this, claiming it has no legal basis. Trump is also trying to expedite the appointment of Stephen Miran to replace Adriana Kugler on the Federal Reserve Board before the meeting. It is a tense time, as everyone is waiting to see what the Federal Reserve will do next.