Fed's Williams Dims Rate Hike Odds for October Meeting
New York Fed President John Williams signaled no rush for a rate hike, sharply lowering market expectations for the October 28 Federal Reserve meeting.
A relatively dovish speech by New York Fed President John Williams sharply trimmed expectations for a rate hike at the upcoming Federal Reserve meeting on October 28.
Markets responded to Williams' comments by cutting the probability of a rate hike next month to 49%, down from 71% on Tuesday, according to CME FedWatch tools.
Williams stated during his address at the University at Buffalo that there is no need to rush into raising interest rates, noting that policymakers have time to gather more data. However, he left the door open for potential action later in the year, depending on economic developments.
Furthermore, Williams noted he has not yet seen evidence that pressures stemming from tariffs, energy, and AI investments are spilling over into broader, more persistent inflation. He projects inflation to reach 3.5% by the end of the year, slightly above the Fed's target, before returning to the 2% goal by 2028.
