ECB’s Williams: The outlook is uncertain and the FOMC must be data dependent

• Inflation is moving towards 2%, expect further bumps
• Fed has made considerable progress
• Inflation to stand at 2.25-2.50% this year
• Expects inflation to settle back to 2% next year
• Expects US GDP to hit 2% ghis year
• Job market remains strong
• Housing very strong but doesn’t see sign of a bubble
• Commercial real estate an area of concern, will take time to resolve
• Fed forecasts rate cuts starting this year
• These great deal of uncertainty over economy
• US economy has benefited from positive supply shock.
• Inflation fell faster than expected last year.
• Progress on inflation has hit some bumps with recent data being disappointing.
• Better to focus on transfer inflation
• Doesn’t know exactly what lies ahead for monetary policy.
• The economy is in a good place right now.
• Monetary policy is well-positioned to achieve fed goals
• Does not see a financial stability crisis from commercial real estate.

There is no change in tone here after yesterday’s CPI but in February he said his inflation forecast was 2.00-2.25%. Now it’s 2.25-2.50%.

This article was written by Adam Button at www.forexlive.com.