Fed's Williams says forecasts back late-2014 rate hike

Reuters News
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Posted: Apr 03, 2012 5:36 PM

SAN DIEGO (Reuters) - San Francisco Fed President John Williams said on Tuesday that if the U.S. economy grew at the rate he expected and unemployment stayed elevated, the U.S. Federal Reserve is justified in keeping interest rates low through late 2014.

"If the economic conditions change, that would move the date up," Williams said in answer to a question after a speech at the University of San Diego School of Business Administration.

Williams said he expects the unemployment rate to end this year at around 8 percent, and inflation to fall to 2 percent this year and 1.5 percent next year.

(Reporting by Ann Saphir; Editing by Chizu Nomiyama)