Federal Reserve Bank of New York President John Williams told Bloomberg on Tuesday that the impact of the Iran war will drive up headline inflation.

Key takeaways

"Inflation this year should be around 2.75%."

"Fed is very focused on underlying inflation."

"Story on core inflation hasn't changed very much."

"Tariffs remain a big part of the inflation story."

"Monetary policy is exactly where it needs to be, can be changed if needed."

"Expecting 2% to 2.5% GDP this year with stable unemployment rate."

"Labor market situation is pretty complicated."

"Job market is low hire, low fire."

"Underlying inflation to moderate later this year."

"US economy is remarkably resilient, tech broadly is helping productivity levels."

"Compensation growing consistent with productivity, not pressuring inflation."

"Businesses have been adapting to more uncertain world."

"Fed is focused on work, leadership concerns are not an issue."

Market reaction

The US Dollar Index stays in the lower half of its tight daily range and was last seen losing 0.07% at 99.92.