New York Fed’s Williams says yield surge due to strong economic prospects
Analysis: Lower Treasury yields could require a weaker economy. Trump won’t fix them
... The rise in real yields is “more of a reflection of the strength of the economy,” New York Federal Reserve President John Williams told CNBC Wednesday. Some people want to read the rise in yields as dragging on the economy, but that logic is backward, he said.
“It’s not really about financial conditions affecting the economy. It’s more about the economy affecting financial conditions,” Williams said.
The flip side of Williams’ analysis is that it may take an economic slowdown for borrowing costs to cool. But that isn’t a solution anyone would want to root for.
