The Federal Reserve is "getting closer" to a point where it can start cutting interest rates but will lack sufficient data before its July meeting to confirm inflation is on a sustainable path back to 2%, New York Fed President John Williams said in an interview published Wednesday.

The U.S. central bank is widely expected to keep its benchmark rate unchanged in the 5.25%-5.5% range, where it has stayed for the past year, at its next July 30-31 meeting, but markets are pricing in a cut in September.

"I feel like the past three months—and I would include in June, based on what we've seen — seems to be getting us closer to a disinflationary trend that we’re looking for," Williams told the Wall Street Journal. "I would like to see more data to gain further confidence inflation is moving sustainably towards our 2% goal. We've got a few good months now," he said.

More and more Fed policymakers have suggested they are getting increasingly comfortable that the pace of price increases is more firmly on track back down to the Fed's goal, after higher-than-expected readings earlier in the year.

By the Fed's preferred measure, inflation in May was running at a 2.6% annual rate, down from the 7.1% peak reached during the COVID-19 pandemic. The June data is due on July 26.

Fed Chair Jerome Powell on Monday also said that inflation readings over the second quarter of this year "add somewhat to confidence" on its downward path, suggesting a start of an easing cycle may not be far off.

Williams all but ruled out a July cut. "We're actually going to learn a lot between July and September. We'll get two months of inflation data," he said.

Williams also pushed back against concerns that bringing inflation back to the Federal reserve's 2% goal would be harder than bringing it down from its peaks to the current levels. "We've actually seen a broad decline in inflation...So it is not really a story about a "last mile" or some part that's particularly sticky," Williams said. "Different inflation measures move at different rates and are influenced by different factors. But I do see them all ... moving in the right direction and doing that pretty consistently."