2017.03.2323:41:00UTC+00Fed’s William Says Three or More 2017 Rate Hikes Sensible

San Francisco Fed Chief John Williams said that the economy is currently experiencing positive momentum and that the rate-setting committee of the U.S. central bank should continue to tighten monetary policy this year in accordance to the pace they have set last year or even at a faster rate.

The Fed official added that his view is in line with the view of his colleagues. He also sees three or even more rate hikes this year to be sensible. However, he also noted that such move would still be relative to the economic data.

For the first time this year, the FOMC lifted rates by a quarter of a percentage point and indicated that more hikes are to be expected this 2017. Average estimates show tree rate hikes this year.

Williams added that the economy's conditions have been very positive and that risks remains in check.

With regards to the issue on when the Fed will begin to reduce its massive balance sheet, Williams said that the standard to shrink the central bank's $4.5 trillion holdings have not yet been met. He said that after a few rate hikes, the Fed will be closer to starting the process of normalization.