New York Fed President Williams supports keeping interest rates unchanged, stating that inflation and employment risks are roughly balanced.

Zhitong Finance APP reports that on Thursday, the Federal Reserve’s “third-in-command,” New York Fed President William Williams, said that the risks to inflation and employment are roughly balanced at present, supporting the decision to keep interest rates unchanged.

In remarks to the media, Williams noted that, given the policy adjustments since last year and the current level of interest rates, monetary policy “is in a good position,” allowing for a balance between the two major goals of inflation and employment. He believes that the most important thing right now is to maintain this balance, rather than rush to adjust interest rates.

Previously, the Federal Reserve decided to keep interest rates unchanged at its meeting last month. As the Middle East conflict has pushed up energy prices, the Fed is working internally to assess its dual impact on inflation and economic growth. Fed Chair Jerome Powell has also said that policy is currently in a phase suitable for observing developments.

On financial stability, Williams said that recent redemption pressure in the non-bank credit space (i.e., private credit) does not pose a systemic risk. He pointed out that these fluctuations are mainly driven by loan repricing rather than systemic issues, and he emphasized that regulators are closely monitoring risk exposures in the banking system.

Regarding whether some private credit funds face the problem of being “too big to fail,” Williams clearly said that “there is no such issue.”

Meanwhile, other officials also sent more cautious signals. On the same day, Dallas Fed President Logan said that the Middle East conflict is simultaneously pushing up inflation risks and weakening the outlook for the labor market, making policy-making more complicated. Logan noted that the conflict has significantly increased economic uncertainty and is putting pressure on both ends of the Fed’s “dual mandate.”