NY Fed Pres. Williams is on the wires saying:

• Debate of 50-75 basis points is right position for July meeting
• More data to come, but Fed still need to move expeditiously to more normal rate levels
• Fed funds rate at 3% to 3.5% by year end, but a lot of uncertainty after that
• Terminal level of rate hike cycle will hinge on behavior of  inflation , and inflation expectations
• rising market interest rates are affecting the economy, but full effect of the Fed pivoted won’t be apparent until later in the year
• spending data is probably the 1st place where global slowdown will be seen. Jobs will lag
• expects to get some help from supply-side, but demand and supply must be aligned
• commodity price reversals could have a disinflationary impact
• recession not base case but clear the economy is slowing
• negative GDP in Q1 enter data into the spring not a signal of something fundamentally negative

The New York Fed Pres. may be up for debate on 50 or 75 basis points, but the market is looking for 75 basis points after today’s jobs data. Next weeks CPI data which is expected to rise by close to 1% for the month is also not the type of data that would encourage anything other than another 75 basis point hike.