John C Williams: Certain uncertainty

Remarks by Mr John C Williams, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Macroeconometric Caribbean Conference, Nassau, Bahamas, 21 March 2025.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Central bank speech  | 
24 March 2025

As prepared for delivery 

Introduction

Good morning, everyone. I'm so pleased to be here with you today.

As it says on my CV, monetary policy under uncertainty has been my primary area of research. And after 30 years in central banking, I can unequivocally say: Uncertainty is the only certainty in monetary policy.

Today I will discuss the economy and monetary policy in the context of a changing and uncertain landscape. I'll talk about global inflationary trends, inflation expectations, and how the Federal Reserve is working to achieve its dual mandate of maximum employment and price stability.

Before I go further, I must give the standard Fed disclaimer that the views I express today are mine alone and do not necessarily reflect those of the Federal Open Market Committee (FOMC) or others in the Federal Reserve System.

The Economy Today

I will start with a snapshot of the U.S. economy. The economy entered the new year on firm footing. GDP and job growth have been solid, propelled by robust gains in the labor force and productivity. After a period of cooling, a wide range of labor market indicators, including the unemployment rate, have stabilized, with supply and demand broadly in balance and the labor market no longer a source of inflationary pressure.2

The disinflationary process has continued on a bumpy path toward the FOMC's inflation goal of 2 percent over the longer run. After reaching a 40-year high of over 7 percent in 2022, inflation-as measured by the 12-month percentage change in the personal consumption expenditures price index-has fallen to about 2-1/2 percent, still somewhat above our 2 percent target.