By Michael S. Derby

NEW YORK (Reuters) -Federal Reserve Bank of New York President John Williams said on Friday that the central bank, which last week decided to stop shrinking its stock of bonds, may soon need to grow its balance sheet through bond purchases.

“The next step in our balance sheet strategy will be to assess when the level of reserves has reached ample” from the current state of “somewhat above ample,” Williams said in the text of a speech prepared for delivery at the European Central Bank Conference on Money Markets 2025 in Frankfurt.

When that happens, “it will then be time to begin the process of gradual purchases of assets,” he said.

“Based on recent sustained repo market pressures and other growing signs of reserves moving from abundant to ample, I expect that it wil

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