WASHINGTON — As the Federal Reserve considers how quickly to raise its benchmark interest rate, officials are struggling to reconcile the strength of job growth with the weakness of inflation.
John Williams, the president of the Federal Reserve Bank of San Francisco, argues that the American economy is healthier than it looks and that inflation softness is overstated.
In an interview on Monday, Mr. Williams said prices of goods and services that tend to rise and fall with the economy are rising at a healthy pace. The weakness is concentrated in the prices of goods and services that tend to march to their own beat, notably health care.
Mr. Williams, who will hold a vote on the Fed’s monetary policy committee in 2018, said the Fed should aim to raise rates in December, and three more times next year.
The conversation is edited for length and clarity.
