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Fed's Williams reiterates rate policy is in right place given outlook

BY Reuters | ECONOMIC | 09:38 AM EDT

By Michael S. Derby

NEW YORK, May 28 (Reuters) - Federal Reserve Bank of New York President John Williams said on Thursday central bank monetary policy is in the right place given the outlook, adding he expects inflation to be high in the near term with the pressures easing later in the year.

"Right now monetary policy for the Fed is, is right where we want it to be," Williams said at the Reykjav?k Economic Conference in Iceland.

Fed policy is "slightly restrictive" and "taking a longer view...we are well positioned to continue to learn what happens with the conflict, with other data, before we need to make a decision" on changing interest rates, he said. (Reporting by Michael S. Derby)

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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