Federal Reserve Governor Christopher Waller said Friday that the U.S. central bank should proceed with another interest rate cut in December, arguing that recent weakness in the labour market outweighs concerns about inflation — even as official data releases remain frozen by the government shutdown.
- “We know inflation is going to come back down,” Waller told Fox Business Network’s Larry Kudlow. “That’s why I’m still advocating that we cut policy rates in December. That’s what all the data is telling me to do.”
Despite the data blackout caused by the shutdown, Waller said the Fed still has enough information to guide monetary policy. He noted that underlying inflation pressures have eased, with core PCE inflation excluding temporary factors running near 2.5%, and that inflation expectations remain well anchored.
- He also urged policymakers to “look through” any price increases stemming from tariffs, which he described as having only a minor and temporary impact on inflation. “Inflation is coming back to 2%,” he said, adding that his “biggest concern now is the labour market.”
- Waller rejected suggestions that the data gap should cause the Fed to pause policy moves. “Data fog does not tell you to stop,” he said. “The right thing to do with policy is keep cutting.”
When asked about his own future, Waller signalled he would be open to leading the central bank if nominated. “If the president asked me to be Chair, I’d say yes,” he told Kudlow.
This article was written by Eamonn Sheridan at investinglive.com.