New York Federal Reserve President John Williams, addressing a key market concern, said Thursday the move of near-term bond yields above their longer-duration counterparts is only one consideration when determining what the economy will look like in the future.

The inverted yield curve is not "an oracle," he said during a question-and-answer session with CNBC's Steve Liesman.

Previous occurrences have been reliable recession indicators, particularly when the three-month Treasury yield rises above the benchmark 10-year note.

"I don't go to it like an oracle: 'Tell me the answer, will there be a recession?'" Williams said following a speech he delivered in New York to the Council on Foreign Relations. "I think it's like other market indicators. It's telling us that there's heightened concerns about the risks on the outlook."

His comments come amid intense market speculation over the path of interest rates. Futures pricing as gauged by the CME's FedWatch index point to at least two and perhaps three rate cuts this year starting in July.

Williams, though, evaded questions about where he thinks rates are going, as Fed officials almost always do, saying only that his current economic outlook is strong but he recognizes challenges ahead. In particular, markets are concerned about the U.S. trade war with China and another looming front in Mexico.

Expectations that the Fed will keep rates low in a slow-growth environment have driven down government bond yields to multiyear lows.

"Coming into the second quarter, the economy has been on, I think, a very strong trajectory in both GDP and employment and unemployment. When I look at the first half of the year, my forecast is for a well above-trend rate of growth," Williams said. "At the same time, looking ahead, monetary policy always has to think about where is the economy likely to go over the next year or two."

An indicator from Williams' New York Fed that tracks the bond yield spread and uses it as a base for recession probability shows a 30% chance of negative growth in the next 12 months, the highest since the Great Recession. Williams said he believes the reading is reflective of growing concerns about a slowdown.