Global: Fed’s John Williams Urges Central Banks to Brace for Uncertainty and Innovation

Federal Reserve Bank of New York President John Williams has cautioned that central banks must be prepared to navigate an era defined by unpredictable change, calling for robust strategies to manage uncertainty.

Speaking in prepared remarks at an event in Amsterdam, Williams emphasized that global economies will continue to face disruptions from forces such as demographic shifts, artificial intelligence (AI), and emerging innovations in financial systems.

“Unpredictable change and uncertainty will certainly continue to be with us for the foreseeable future,” Williams noted. He stressed that monetary authorities need principles and frameworks flexible enough to respond to evolving challenges, while still ensuring financial stability.

Williams, who also serves as vice chair of the Federal Open Market Committee (FOMC), did not comment directly on U.S. monetary policy. The Fed recently cut interest rates in a bid to counter growing risks to the labor market.

Highlighting the evolution of monetary tools, Williams observed that once-unconventional measures such as quantitative easing (bond purchases) are now standard parts of central banks’ policy arsenal. He argued that adapting to novel situations requires a readiness to deploy both traditional and innovative mechanisms to safeguard economic resilience.

The comments reflect a growing recognition among central banks globally that structural changes—including technological disruption—are reshaping how monetary policy interacts with financial systems.