New York Fed President Williams supports maintaining interest rates unchanged, stating that inflation and employment risks are roughly balanced.

On Thursday, New York Fed President Williams, one of the top officials of the Federal Reserve, stated that the current risks facing inflation and employment are roughly balanced, and he supports maintaining interest rates unchanged. Williams pointed out in a media interview that considering the policy adjustments since last year and the current level of interest rates, monetary policy is in a good position to achieve a balance between the two major goals of inflation and employment. He believes that the most important thing now is to maintain this balance rather than hastily adjusting interest rates. Previously, the Federal Reserve decided to keep interest rates unchanged at the last month's meeting. As tensions in the Middle East drive up energy prices, the Fed is internally assessing its dual impact on inflation and economic growth. Fed Chairman Powell has also stated that the current policy is in a phase suitable for observing developments. Regarding financial stability, Williams believes that the recent redemption pressures in the non-bank credit sector (i.e. private credit) do not pose systemic risks. He pointed out that these fluctuations are mainly due to loan repricing rather than systemic issues, and emphasized that regulators are closely monitoring risks within the banking system. Williams explicitly stated that there is no issue of private credit funds being "too big to fail." Meanwhile, other officials are sending more cautious signals. Dallas Fed President Kaplan stated on the same day that the Middle East conflict is simultaneously increasing inflation risks and weakening the labor market outlook, making policy-making more complex. Kaplan noted that the conflict significantly increases economic uncertainty and puts pressure on both ends of the Federal Reserve's "dual mandate."