MNI BRIEF: Fed's Williams - Ukraine Impact Not Stagflationary

New York Fed President John Williams said Thursday the U.S. economy will face additional inflation pressure from the oil price surge related the war in Ukraine, but also some slowing in consumer demand, though he pushed back against the prospect of stagflation.

"It's definitely not a stagflation issue," he said in Q&A at a Council for Economic Education event, in his first comments since Russia's invasion of Ukraine. The FOMC vice chair said there are "upside risks to inflation" but added that he expects inflation to come down this year, while remaining "well above our 2% goals."

"The first direct effects are higher energy prices passing on to higher inflation," Williams said when asked about the war in Ukraine, while still optimistic about consumers and businesses. "I still think that's happening in the context of very strong household balance sheets" and business balance sheets, he said.