Fed's Williams Vows To Use All Tools To Stabilize Prices: What Central Bank Officials Say About Inflation, Recession

Federal Reserve Bank of New York President John Williams reportedly said Wednesday that inflation is still at problematic levels and the central bank will use its tools to rein in price hikes.

"Inflation is still too high, and we will use our monetary policy tools to restore price stability," Williams said in a speech before a gathering held by the Money Marketeers of New York University, according to a Reuters report.

Williams also noted that the banking sector stress appears to be cooling off. "Conditions in the banking sector have stabilized, and the banking system is sound and resilient," he said adding that the troubles will likely make credit more expensive and harder to get.

Also Read: Best Penny Stocks

"It is still too early to gauge the magnitude and duration of these effects, and I will be closely monitoring the evolution of credit conditions and their potential effects on the economy," Williams said.

The Fed official stated the large levels of emergency bank borrowing from the central bank, which stood at $323 billion via three programs as of a week ago, are not an issue and the apex institution is happy that banks are asking for liquidity if they need it.

Williams also indicated he does not expect a recession in contrast to the staff view of the Fed, which was revealed in meeting minutes for the March FOMC meeting.

Goolsbee's Remarks: Federal Reserve Bank of Chicago President Austan Goolsbee said in an interview on NPR's Marketplace that he was still waiting to see if the fallout from the banking crisis could slow the economy more than expected.

"Everybody is forecasting some growth slowdown for the second half of the year. How intense that will be is going to depend a lot on the financial part," he said, according to a Bloomberg report that cited NPR.

"The job market is by far the strongest part of the economy. Still getting really unprecedented numbers," Goolsbee stated. "Inflation — there's been some improvement, but in a way that's the worst part of the economy," he added while observing that it has been "more persistent than we wanted."

Read Next: Why Elon Musk Stands By Tesla’s Decision To Prioritize Volume Over Margin