The Fed is looking for signs that it’s meeting its dual mandate of stable inflation and maximum employment as it charts the course for rate increases. Price pressures have remained below the Fed’s 2 percent goal since 2012, and Williams made it clear while talking to reporters that they’ll be his focus this year.
“The big question mark in 2016 to me is really on this inflation front,” Williams said Monday, noting that questions about labor market slack probably would be resolved as the job situation continues to improve. If “global growth slows, and global inflation falls, and that pushes the dollar up, that’s clearly a scenario that would cause us to take longer to get to our inflation goal, and I think would call for a little bit more accommodation.”
The inflation ECG (again)
And everything points to a Fed that has been tightening (opposite of accommodative) since mid-2014!
Funny thing: Williams believes the “cadaver” will “stand-up” (one day sometime in the future)