San Francisco Fed President John Williams said even though the economy shows “consistent” and “encouraging” signs, “housing still isn’t quite back.”
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“Housing construction is still quite muted,” Williams said during an interview with the FOX Business Network’s Maria Bartiromo. “We have the millennials still staying home, or not going out to buy houses, and other factors that seem to be holding back the housing market.”
While tech is “booming beyond belief” and contributing to growth in certain areas, more investment is needed in the Central Valley of California, Eastern Oregon, Washington and parts of Alaska, he added.
Williams also sees more “upside potential to the economy” and projected three rate hikes in 2017.
“Three rate hikes overall for this year seems to be about right. I think there’s some upside risk to the economy, not risks, but upside potential to the economy,” he said.
He added: “We’ll need to have maybe four rate hikes this year depending on the economic data [and] depending on how inflation and employment do. I think that will continue more next year as we move towards more of a normal interest rate.”