Federal Reserve Bank of San Francisco President John Williams said he expects inflation to remain around the central bank’s goal of 2 percent as labor costs are “muted” given the high unemployment rate.
“Inflation expectations are well-anchored,” Williams said today on a panel in Beverly Hills, California. “We’ve done a pretty good job at keeping inflation low and relatively stable.”
Williams, who votes on the policy-setting Federal Open Market Committee this year, said the central bank will tighten monetary policy if inflation risks rise, though he doesn’t expect that to happen “for quite some time.”
“We know what to do,” Williams said. “We are very committed to making sure that our policies keep inflation low and stable.”