October 21, 2016 / 7:35 PM / 3 years ago

Fed is trying to make policy as predictable as possible: Williams

SAN FRANCISCO (Reuters) - The Federal Reserve is trying to make policy as predictable as possible so as to minimize outsized effects on international financial markets, San Francisco Fed President John Williams said on Friday.

Williams also said he expects the Fed to allow its balance sheet to shrink only after rates are “well away” from zero, and that eventually it will be a lot smaller than the current $4.5 trillion. Even so, he said, it is unclear whether a smaller balance sheet will result in a much steeper yield curve because of global headwinds and other factors that are pushing down on long-term rates more than in the past.

Reporting by Ann Saphir; Editing by Chizu Nomiyama

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