Story perspectives

NY Fed chief: Energy prices peaked, inflation still high.

7/11/2026

Summary

Story summary

John Williams, Reserve Bank of New York president, said July 9 2026 energy prices are near a peak and will decline despite Middle-East fighting.
He warned inflation stays above the Federal Reserve (Fed)’s 2 % target, with the PCE index up 4.1 % in May and one-year-ahead expectations at 3.7 % in June.
He noted the Fed kept the federal funds rate at 3.50 %-3.75 % after the June 16-17 meeting and is debating hikes later this year.

History

Historical Context

In 1979, the Federal Reserve, led by Chairman Paul Volcker, sharply raised interest rates to quell soaring inflation after the oil shock. The Federal Open Market Committee, under Volcker, pushed the federal funds rate to 20 % by 1981, while the CPI peaked at 13.5 % in 1980. Today, Reserve Bank of New York President John Williams cites near-peak energy prices yet persistent inflation, with the Fed holding rates at 3.50-3.75 %. The 1979 experience warns that modest rate cuts may prove insufficient, prompting policymakers to consider further hikes to anchor inflation expectations.

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Story summary

John Williams, Reserve Bank of New York president, said July 9 2026 energy prices are near a peak and will decline despite Middle-East fighting.
He warned inflation stays above the Federal Reserve (Fed)’s 2 % target, with the PCE index up 4.1 % in May and one-year-ahead expectations at 3.7 % in June.
He noted the Fed kept the federal funds rate at 3.50 %-3.75 % after the June 16-17 meeting and is debating hikes later this year.

1 / 2