Fed's Williams: Near Term, Inflation Around 4% And Core Inflation Around 3%

Thank you for the opportunity to speak today. I’d like to discuss one of the most fundamental challenges we face as economic policymakers: understanding structural economic change as it happens. There are many types of structural change that create such a challenge, including changes in the famous star variables like the natural rates of unemployment and interest. But today, I’ll focus on shifts in the trend rate of productivity growth. I’ll boil this topic down to a simple two-part question: how does the economy respond to a shift in the rate of productivity growth, and what does it mean for monetary policy? It may seem like a basic question that should have been long settled by now. But the further you delve into trying to answer it, the more nuanced it becomes. This question is especially timely today because of all the attention on artificial intelligence and its potential to spur a productivity boom. But this is not our first productivity growth rodeo. Thankfully, history provides important lessons for us to learn from. Think back to the 1970s, when the United States experienced a pronounced productivity slowdown following a quarter century of remarkable postwar growth. This was followed by an acceleration beginning in the mid-1990s, which itself reversed in the mid-2000s. These episodes weren’t minor statistical curiosities—they fundamentally reshaped the macroeconomic landscape. The productivity slowdown of the 1970s contributed to stagflation. And the productivity boom of the late 1990s and early 2000s was a contributing factor to that decade’s economic prosperity with low in Fed's Williams does not comment on near-term monetary policy outlook.

Durable goods orders in the United States surged by 1.9% in April to reach $346 billion, the US Census Bureau reported on Thursday. The figure marked a jump from March's revised ...

Canada’s financial system has continued to function well despite US tariffs and trade uncertainty. But a more turbulent global environment poses risks to financial stability, particularly if several vulnerabilities crystalize at the same time. The Canadian financial system continues to be resilient. Households and businesses remain in stable financial condition, and banks have strengthened their capacity to absorb shocks. However, vulnerabilities have increased in some parts of the system. Valuations of many financial assets have continued to rise, increasing the risk of a sudden correction. At the same time, global sovereign debt issuance is growing, and hedge funds have increasingly absorbed this debt in recent years. Individually, these vulnerabilities are manageable. But with increased economic and geopolitical risks, it is more likely a new shock or a combination of shocks could cause multiple vulnerabilities to crystalize at once. If this were to happen, these vulnerabilities could interact and reinforce each other. In the extreme, a cascading series of events could cause a sharp loss of investor confidence. This could lead to liquidity hoarding or rapid asset sales, putting pressure on core funding markets. Stress could then spread across the financial system and the broader economy. Just in | BoC Financial Stability Report Highlights Elevated Risks Yet Affirms Resilience of Canadian Financial System. BOC SAYS NEW SHOCKS MAY EXPOSE SEVERAL VULNERABILITIES AT ONCE. A SERIES OF EVENTS COULD LEAD TO A SIGNIFICANT DROP IN INVESTOR CONFIDENCE AND AFFECT MAIN FUNDING MARKETS, ACCORDING TO BOC.