Federal Reserve Bank of New York President John Williams said he expects inflation to continue falling in the second half of this year, adding that elevated borrowing costs are restraining the economy.

In a major speech at the Economic Club of New York, Williams said he expects inflation to “resume moderating in the second half of this year.” Inflation has been sticky over the first four months of the year, but Williams said this was not the start of an upward trend.

Williams stated that the economy's behavior over the past year provides ample evidence that monetary policy is restrictive in a way that helps achieve their goals. He made these remarks in the text of a speech prepared for delivery before a gathering of the Economic Club of New York.

With markets on edge over the direction of monetary policy, Williams offered no clear indication of where he is leaning with possible interest rate cuts.