Investing.com -- Federal Reserve Bank of New York President John Williams said Thursday that uncertainty about the economic outlook is limiting what central bankers can say about the outlook for interest rate policy.

"It's not a time to try to give strong forward guidance" given how much uncertainty there is now with the economy and the impact of the Middle East war, Williams told reporters after a speech in New York. If inflation comes back to 2%, "I do think it will be appropriate to bring interest rates down, but that's not where we are today," the official said.

Williams said the Fed is in the right place for monetary policy and that inflation will be well above 3% over the next few months. He added that the longer the conflict lasts, the bigger the economic impact will be.

The official noted that market pricing is balancing a strong U.S. outlook versus war uncertainty. Some of the market strength is due to reduced U.S. exposure to oil shocks, Williams said, adding that the war shock is about prices but also unavailable commodities.

Williams emphasized that well-anchored inflation expectations are important. When asked about risks, he said cyber risk is the thing that keeps him up at night.