The Federal Reserve could raise interest rates five times this year, says San Francisco Fed President John Williams. Despite weak economic conditions, the central bank may move forward with three to five rate hike says, according to the Fed bank president.
Speaking in an interview with CNBC, Williams explained that the U.S. economy is doing pretty well and remains stronger than other established economies.
Williams projects the country is on track to create jobs, and would need three to five rate hikes in 2016 to meet his forecast of two percent economic growth and an unemployment rate under 4.5 percent by the end of 2016. Overall, Williams thinks the U.S. central bank would hike rates to 3.5 percent.
“We are, relative to most other countries, in very good shape, partly because we took very aggressive monetary policy actions, and other actions, to get our economy back on track,” said Williams.
On the issue of Monday’s dark day in global markets (SEE: Global financial markets plummeting as China halts stock trading after 7% collapse), Williams noted that he’s not too concerned about what happened. He blamed the beating in stock markets on China shifting away from manufacturing and more into consumerism.
With that being said, Williams, who does not have a vote on the Federal Open Market Committee, made the point that the Fed doesn’t have a stock market tracker on any of the desks to determine monetary policy. Instead, the Fed, according to Williams, maintains a medium term plan.
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