New York Fed President William Dudley on Friday said he still expected sufficient economic strength to push the unemployment rate down further and for the economy to be slightly above the long-term trend this year. Dudley did acknowledge that data since the December rate hike has "been on the softer side." The key official, who gets a vote at every meeting, explained his vote in support of a rate hike, saying it needed to be done now in a gradual way to prevent sharp tightening later. Dudley, who didn't in prepared remarks get into the debate over whether there is likely to be four rate hikes this year, also played down the difference in rate projections between the Fed's summary of economic projections and the path implied by the federal funds futures market, noting the market incorporates all views, including outliers, and the Fed path is a median projection. "The difference between means and modes is the main factor for the gap between the federal funds futures market and the SEP path," he said.
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