FED: NY's Williams Still Sees Policy As "Modestly Restrictive" Amid Uncertainty

Picking up where Chair Powell left off on Wednesday (in a press conference where he used the terms "uncertain" or "uncertainty" 15 times), NY Fed Chair Williams (permanent FOMC voter, dove) says that "uncertainty is the only certainty in monetary policy" (in a speech titled "Certain Uncertainty"). His overall outlook doesn't really look like it's changed since pre-FOMC: "The current modestly restrictive stance of monetary policy is entirely appropriate given the solid labor market and inflation still running somewhat above our 2 percent goal. It also positions us well to adjust to changing circumstances that affect the achievement of our dual mandate goals."

• (In February he noted that "The modestly restrictive stance of policy should support the return to 2% inflation while sustaining
  solid economic growth and labor market conditions.") As usual, he's not explicit about what his view of the rate path is.
• He does seem to suggest that he views uncertainty having risen recently, though remains calm because long-term inflation expectations remain contained: "Recent data—both hard and soft—are sending mixed signals. Measures of policy uncertainty have increased sharply in recent months....In the past two months, we have seen clear signs of a broad-based increase in short-term inflation expectations, but most indicators point to continued well-anchored medium- and longer-term expectations" (citing the NY Fed's business and consumer surveys).
• He also puts a more quantitative spin on Chair Powell's comment Wednesday that the jump in University of Michigan Survey long-term inflation expectations is an "outlier". Williams: "The sensitivity of short-run inflation expectations to inflation shocks—while medium- and longer-run expectations are well anchored—is also seen in formal econometric analysis using data from the SCE and the University of Michigan surveys....Importantly, there are no signs of inflation expectations becoming unmoored relative to the pre-pandemic period."
• On growth and inflation, "I expect GDP growth this year to step down from last year’s pace in part because of a slowdown in labor force growth due to lower immigration rates. But it’s hard to know with any precision how the economy will evolve...the [March SEP] central tendency of projections for GDP growth this year was between about 1-1/2 and 2 percent, and for inflation, between about 2-1/2 and 3 percent. Any of these outcomes—or even some others outside these ranges—seem completely plausible to me."
• He repeats Powell's language on the decision to taper QT: "This week’s decision to slow it further is a natural next step to smooth the transition from abundant reserves to a level that is somewhat above ample."