John C. Williams, President and CEO of the Federal Reserve Bank of New York, speaks on 6 March 2019 in front of the New York Economic Club.
Lucas Jackson | Reuters
As the president of the New York Federal Reserve, John Williams, said that central bankers need to "act fast" when economic growth slows down, a spokesman said that he drew on research and did not hint what was happening Meeting of the Federal Open Market Committee could happen this month.
"This was an academic speech over 20 years of research, it was not about potential policies at the upcoming FOMC meeting," a spokesman for the New York Federal Reserve told CNBC.
Previously, at the annual meeting, Williams delivered a speech from the Central Bank Research Association, stating, "It's better to take preventive action than wait for a catastrophe to occur."
His comments therefore come as Wall Street expects the US Federal Reserve to lower its key interest rates in July for a 30-31
According to Williams' earlier remarks, market expectations for a 50 basis point cut in the key rate, according to CME's Fedwatch tool, increased to about 59%. Before his speech, the predictions for a half point reduction were between 20% and 30%.
Later, Fed Deputy Chairman Richard Clarida told Fox Business News it is a good strategy to quickly cut interest rates. Market expectations for a cut of half a point even increased further to about 69%.
After New York Fed spokesman Williams commented, expectations for a 50 basis point cut at around 7:00 pm dropped to around 50%. Eastern Time.
The Fed is currently coupling the daily money rate in a range between 2.25% and 2.5% – above zero, but still well below the normal levels prevailing during past economic expansion.
– Fred from CNBC Imbert and Patti Domm have contributed to this report.