The Federal Reserve could scrap its forward guidance once monetary policy is more normal, said John Williams, the president of the San Francisco Fed, on Thursday. "Once we make the return to a more normal policy environment, we won't need to be so explicit," Williams said in a speech in Las Vegas. The Fed's forward guidance has found that changing its policy guidance is not easy. At its September meeting, it considered scrapping its pledge that policy would stay low for a "considerable time" out of concern that the market would view it as a fundamental shift in policy. Williams said the economic outlook looked "pretty upbeat" and the first interest rate hike would likely occur sometime in the middle of next year.
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