Fed's Williams: 'Critical' central banks understand impact of digital money

1/6/2022 7:20:00 PM

Fed's Williams: 'Critical' central banks understand impact of digital money

Fed's Williams: 'Critical' central banks understand impact of digital money

NEW YORK : The development of digital currency and payments technologies could change how the Federal Reserve conducts monetary policy and the composition of its balance sheet, issues the central bank will need to work to understand, New York Fed President John Williams said Wednesday.'Digital transformat

NEW YORK : The development of digital currency and payments technologies could change how the Federal Reserve conducts monetary policy and the composition of its balance sheet, issues the central bank will need to work to understand, New York Fed President John Williams said Wednesday.

"Digital transformation could have implications for markets and for our interactions with counterparties, as well as how we carry out monetary policy," Williams said in opening remarks to a research conference at Columbia University."The big question is what a world of digital currencies like stablecoins and (central bank digital currencies) would mean for the implementation of monetary policy. How will central banks anticipate and adapt?" Williams said.

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LinkedIn NEW YORK : The development of digital currency and payments technologies could change how the Federal Reserve conducts monetary policy and the composition of its balance sheet, issues the central bank will need to work to understand, New York Fed President John Williams said Wednesday.LinkedIn WASHINGTON: President Joe Biden on Tuesday (May 31) holds a rare White House meeting with the head of the Federal Reserve, Jerome Powell, to discuss soaring inflation and White House attempts to tame the politically damaging price surge ahead of midterm elections.LinkedIn KYIV: Ukraine is fed up with"special solutions" and separate models for its integration into the European Union and wants full membership, Foreign Minister Dmytro Kuleba said on Monday (May 30).LinkedIn LONDON : A central bank digital currency would not pose an excessive challenge for the Bank of England's operations, Andrew Hauser, the BoE's executive director for markets, said on Wednesday.

"Digital transformation could have implications for markets and for our interactions with counterparties, as well as how we carry out monetary policy," Williams said in opening remarks to a research conference at Columbia University. "The big question is what a world of digital currencies like stablecoins and (central bank digital currencies) would mean for the implementation of monetary policy. This is Biden's"top economic priority", the White House said,"as we transition from a historic economic recovery to stable, steady growth that works for working families". How will central banks anticipate and adapt?" Williams said. France has tried to reassure Kyiv that an initiative to forge closer ties between the bloc and aspiring members would not replace their bids to join. The role of central banks"will always be to supply money and liquidity to bring stability to the economy and financial system," he said. Employment is back near pre-pandemic levels and growth is strong, but savage price increases for essentials including food and fuel are driving growing public dissatisfaction. But"it’s critical that we understand how these transformations could affect the economy and the financial system, as well as monetary policy implementation.

" The Fed is debating whether to create its own version of a digital currency, and the administration of President Joe Biden is undertaking a broader discussion about the regulation of cryptocurrencies and related technologies like stablecoins. Federal Reserve Governor Christopher Waller said Monday that he backs several more half-point rate hikes -"until I see inflation coming down closer to our 2 per cent target". Even if approved, the process takes several years and can be vetoed by any member state. Regardless of whether the Fed creates a digital dollar, the development of a network of private currencies, the growth in size of stablecoin and crypto markets, and the expansion of private payment options could have a profound impact on banks and the legacy financial system that central bank policy relies upon. Source: Reuters . Biden's own approval ratings are barely in the 40 per cent range, reflecting his inability to sell voters on his upbeat message of US economic recovery.