“In the context of a strong economy with good momentum, it makes sense to get back to a pace of gradual rate increases, San Francisco Fed President John Williams said in a speech at the Federal Home Loan Bank of San Francisco.
The Fed hiked rates once last December, after years of keeping them near zero. However, additional rate hikes expected this year haven’t materialized so far.
Williams, who isn’t a voting member of the Fed’s policy-making committee this year, said he didn’t believe rate hikes would slow the country’s economic expansion, according to MarketWatch.
“It’s just the opposite,” he said. “My aim is to keep it on sound footing so that it can be sustained for a long time.”
Williams said that raising rates gradually would reduce the risk of excessive inflation, bubbles, “and ultimately economic correction and recession.”
The president of the San Francisco Fed said Friday that he wanted to see interest rates hiked “preferably sooner than later,” according to a MarketWatch report.