Steve Liesman (Senior Economics Reporter) 00:00.004
john i don't know that the extent to which our viewers know that you're one of the world 's experts when it comes to understanding this concept of the neutral rate the rate the fed would set to not grow the economy and stimulate the economy or not cause it to contract in your
Steve Liesman (Senior Economics Reporter) 00:15.964
view where are we relative to the neutral rate
John Williams (President) 00:18.524
well if the way i think of the neutral rate is in terms of the real or inflation adjusted interest rate and so today based on a forecast of inflation of a little under two and a half percent for next year that puts the real interest rate somewhere around one to one and a quarter
John Williams (President) 00:32.484
percent so that's in the kind of the i would say in the range of estimates of neutral that are out there so i think we have moved toward closer to to neutral my personal view speaking for myself is that the neutral rate is probably a little bit below one percent so we're still
John Williams (President) 00:48.604
mildly restrictive in terms of the stance of monetary policy we still have some room to go ultimately to get back to neutral but that's not guiding my you know my views on what should we do at a specific meeting that's more of a conceptual framework to think about it but clearly
John Williams (President) 01:04.524
i do think that we've gotten closer to neutral i still think we're a little bit a little bit