The Teller Window
A view into the work of the New York Fed

« | Main | »

January 19, 2023

Key Takeaways from President Williams’s Speech on Rebalancing and Realignment in the Economy

On Thursday, January 19, 2023, New York Fed President John Williams spoke at an event hosted by the Fixed Income Analysts Society. He discussed inflation, the continued imbalances between supply and demand, and the effects that monetary policy is having on different sectors of the economy.

He said:

“Although we are seeing some signs that inflation is moderating, it remains far too high, and it is my No. 1 concern going into 2023.”

“With inflation still high and indications of continued supply-demand imbalances, it is clear that monetary policy still has more work to do to bring inflation down to our 2 percent goal on a sustained basis.”

“While the route ahead is still uncertain, I am fully confident we will return to a sustained period of price stability.”

In his remarks, President Williams said that there is rebalancing and movement taking place in the economy today. The swing in demand to goods and housing that occurred during the pandemic is now shifting back to services, but overall demand still far exceeds supply. That is also true in the labor market.

He said monetary policy is like a large gear that is connected to smaller gears representing different sectors of the economy. Not all gears move at the same pace, he said, and the effects of monetary policy are showing up in prices at different speeds, as well as in inflation expectations.

President Williams noted that the FOMC is taking strong actions to align demand with supply in the economy and bring inflation back down. As a result, he expects:

  • Real GDP growth to be modest this year at around 1 percent
  • Unemployment to increase from its current level of 3-1/2 percent to around 4-1/2 percent over the next year
  • Inflation to slow from its current rate to around 3 percent this year, and overall inflation to come back down to 2 percent in the next few years

Read the full speech.

Julie Lasson is an executive communications specialist at the New York Fed.

The views expressed in this article are those of the contributing authors and do not necessarily reflect the position of the New York Fed or the Federal Reserve System.


The Teller Window is a publication featuring expert knowledge and insight from the New York Fed, including thoughts and perspectives from senior leaders. It offers a deep look at issues that matter to the Federal Reserve’s Second District and the nation.

Articles on the Teller Window focus on the people and programs that help the New York Fed support the U.S. economy. They are written for a wide audience with the aim of illustrating what we are doing and why it matters. Stories include editorials, interviews, explainers, and reports on events and trends in our communities and region. The Teller Window is edited by the Communications and Outreach Group on behalf of the New York Fed. Separately, for analysis from New York Fed economists working at the intersection of research and policy, please see Liberty Street Economics.

The New York Fed began publishing on the Teller Window in November 2022. Articles with dates earlier than November 2022 were originally published by the New York Fed on Medium.

Step up to the Teller Window to learn more about the New York Fed’s work and views.