MNI BRIEF: Fed's Williams: Economy Coming Back 'Strong'

Federal Reserve Bank of New York President John Williams said Wednesday the economy is "coming back pretty strong right now" but promised the Fed won't overreact to a temporary burst of inflation due to supply bottlenecks or base effects.

"We could see some period where prices tend to go up for a while, and then astheeconomycomesbacktofullstrengthandpeoplecangetbacktoworkandgetbacktoamorebalancedeconomy,Iexpectsomeofthosewillsettledown," he said in a webinar with Rutgers University students. "Wehavetonotoverreacttothedataandbeveryfocusedonachievingourgoals."

New variants of the virus could also slow the recovery, he added. "We're a little bit in a race between the vaccinations and the new variants of the coronavirus."

Rising worries on Wall Street over runaway inflation are so far misplaced because there is still ample slack in the economy, a Boston Fed researcher told MNI recently.