Fed Governor Waller Signals Support for December Rate Hike and Potential 50 Basis Point Increase
Federal Reserve Governor Christopher Waller indicated on Tuesday that he supports a quarter-point interest rate increase in December. He warned that the central bank must follow through on market expectations for further tightening to maintain its credibility, suggesting that failing to implement promised hikes could lead to an undesirable loosening of monetary policy. Waller noted that if upcoming inflation data is higher than forecast, a more aggressive 50 basis point hike should be considered at the December meeting. While markets currently price in an 80% chance of a quarter-point increase, Waller's comments introduce the possibility of a larger move depending on the Consumer Price Index (CPI) readings due from the Bureau of Labor Statistics.
Topics: Central Bank Communication Federal Reserve Inflation Interest Rates Monetary Policy
Part of the story U.S. Inflation Data and Fed Governor Waller's Hawkish Stance Drive Interest Rate Trading Surge (9 articles)