NY Fed’s Williams says completely sensible to raise interest rates

John C. Williams, president and CEO of the Federal Reserve Bank of New York speaks to the Economic Club of New York in the Manhattan borough of New York

NEW YORK (Reuters) – It is “sensible” for the Federal Reserve to begin raising interest rates this year as it removes some of the support provided during the pandemic, New York Fed President John Williams said Friday.

The Fed will focus on economic data when deciding the exact timing and pace of future rate increases, Williams said, adding that it “makes sense” for the central bank to continue removing accommodation. The Fed official said the central bank should move to reduce its bond holdings after it raises interest rates from near zero levels, and said policymakers have the tools needed to manage the balance sheet smoothly.

(Reporting by Jonnelle Marte)