In a clear effort to ease market fears, John Williams says market rate hikes will be gradual and the Fed Needs to "Stick to That Plan".

The U.S. central bank should stick to the plan of gradual rate hikes even though the economy has shown such “buoyancy” recently,” said San Francisco Fed President John Williams on Friday.

In a speech to the Financial Women of San Francisco, Williams insisted the Fed should not “have a knee-jerk reaction to all this positivity” about the economy.

Raising rates too rapidly could knock the expansion off track “and that’s the last thing I want to see happen,” Williams said.

In his speech, Williams noted that inflation appears to “finally” be turning higher toward the Fed’s 2% target, but added he did not think the economy was overheating.

For the moment, I don’t see signs of an economy going into overdrive or a bubble about to burst, so I have not adjusted my views of appropriate monetary policy,” he said.

Thanks John, for the laugh of the day. Central bankers never see bubbles. Why? They created them.

Williams' statements are in contrast to those made by Alan Greenspan just a few days ago. For details, please see the Man Who Said "Bubbles Only Identified When They Burst" Suddenly Detects Bubbles.

RECOMMENDED ARTICLES

Mike "Mish" Shedlock

US “A Little Beyond Full Employment” Says San Francisco Fed President

The US economy is so good it’s beyond full employment and above potential says John Williams, the San Francisco Fed president.

San Francisco Forces Large Corporations to Pay "Homeless Tax"

Expect homelessness to rise in San Francisco as a result of the city's passage of a homeless tax.

Down the Rabbit Hole: SF Fed President John Williams Seeks “Direct Attack” on Low Inflation

San Francisco Fed president John Williams has been yapping about the need for interest rate hikes, 4% inflation targets, and Fed-set GDP growth targets.

Man Who Says "Bubbles Only Identified When They Burst" Detects Bubbles

Alan Greenspan is on a bubble-announcing campaign. He can see them now, but he couldn't see them then.

San Francisco Airport Lunacy Causing Huge Traffic Congestion

San Francisco does not allow Uber and Lyft to pick up at arrivals. The result is humorous, for those on the outside.

Fed Tightening Cycles Coincide With Bursting of Asset Bubbles: How to Play It

Fed tightening has been a reliable catalyst for the bursting of asset bubbles globally, says Crescat Capital.

NY Fed President Dudley Complains Unemployment is Too Low, Rate Hikes Needed

NY Fed President William Dudley is worried about the low unemployment rate. He thinks the Fed needs to be above neutral.

Fed Worried About Lack of Inflation, Stock Market Bubble (Sort Of)

FOMC minutes show Yellen is no longer convinced that low inflation is transitory. Other members mention bubble concerns.

Dallas Fed President Sees "No Movement" in the Fed Funds Rate

Dallas Fed President Robert Kaplan made some interesting comments today on interest rates, repos, and the coronavirus.