Fed's Wiliams: Fed should maintain bond buys, expected sharp rebound in 2021


The New York Federal Reserve Bank President John Williams said Thursday says a combination of strong fiscal support and continued vaccine distributions could help lift the US economy as it recovers from the coronavirus pandemic and lead to the strongest growth in decades,

"With strong federal fiscal support and continued progress on vaccination, GDP growth this year could be the strongest we’ve seen in decades,"

Still, the economy remains under threat from the pandemic, and new strains of the virus could slow the recovery or lead to more infections, Williams said, echoing remarks made by other Fed officials on Thursday.

Williams said the Fed will "remain committed to using our full range of tools to help assure that the recovery will be as robust as possible."

Key comments

Williams says he is more optimistic about the medium-term outlook for the economy.

Williams says he expects underlying inflationary pressures to remain subdued for some time.

Williams says Fed remains committed to using full range of tools to assure that the recovery will be as robust as possible.

Williams says the emergence of new strains of the virus could slow the path to a post-covid world.

NY Fed's Williams says GDP growth this year could be the strongest in decades with strong fiscal support and continued progress on vaccination.

Williams says further closing the unemployment gap between black and white workers will be an important part of a full recovery.

Market implications

On Thursday, the bond market was rattled in a catastrophic 7-year auction and there were question marks raised over the US stock market valuations and confidence in the US economy in general.

Inflation worries among investors has seen the benchmark 10-year Treasury yields Uhit a one-year high of 1.53%.

This has been prompting investors to lock in profits on some high-flying growth stocks due to concerns over heightened valuations. 

However, Williams says he is more optimistic about the medium-term outlook for the economy, in an effort to give investors some peace of mind. 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Get Weekly Crypto trade ideas!  
Empower yourself with the best market insights

Join FXStreet Premium!    

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD attempts recovery above 1.1950 as USD resumes decline

EUR/USD is attempting a recovery above 1.1950 ahead of the European open, as the US dollar’s rebound falters amid persistent weakness in the Treasury yields. Easing concerns over EU's covid vaccines rollout and dovish Fed expectations underpin the spot.

EUR/USD News

GBP/USD recaptures 1.3850 as UK’s optimism offsets USD bounce

GBP/USD rises above 1.3850, picking up fresh bids heading into the London open. The cheers the UK’s advantage of faster vaccinations and unlock guidelines to shrug off the US dollar’s bounce off late the lowest since late March.

GBP/USD News

XAU/USD buyers attack six-week-old resistance line around $1,780

Gold keeps recovery moves from intraday low to print mild gains, picks up bids off-late. Ascending resistance line from early March tests bulls. 50-day SMA, monthly support line could offer bounces in case of pullback, any further weakness will recall the bears.

Gold News

Bitcoin network hash rate drop may not have caused BTC price crash

China’s prominent regions for Bitcoin mining have suffered an electrical grid blackout, causing Bitcoin’s hash rate to decline. Bitcoin price crashed over the weekend, coinciding with the drop of the network’s hash rate.

Read more

S&P 500 Week Ahead: Banks beat the street, COIN booms as funds flow to ETFs

Equity markets continue to remain bolstered from all sides as the macro environment produces strong numbers, earnings continue to smash estimates and inflation concerns take a back seat. Earnings season switches from bank stocks to reopening plays.

Read more

Forex MAJORS

Cryptocurrencies

Signatures