John Williams, chief executive officer of the Federal Reserve Bank of New York, speaks at an event in New York, U.S., November 6, 2019. REUTERS/Carlo Allegri/File Photo

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PRINCETON, N.J., April 2 (Reuters) – The Federal Reserve needs to move monetary policy towards a more neutral stance, but the pace at which it tightens credit will depend on how the economy reacts, New York Fed President John Williams said Saturday.

Williams, in response to questions at a symposium about whether the Fed needed to hasten its return to a neutral policy rate that neither encourages or discourages spending, noted that in 2019 with rates set near the neutral level “the economic expansion started to slow,” and the Fed resorted to rate cuts.

“We need to get closer to neutral but we need to watch the whole way,” Williams said. “There is no question that is the direction we are moving. Exactly how…

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