Fed Governor Waller Says Inflation Report Will Shape Rate View
Federal Reserve Governor Christopher Waller spoke about interest rates today. He said next week's inflation report will guide his decision.
Waller will help decide on a rate hike at the Fed's September meeting. He said he would support keeping rates steady if inflation keeps easing.
But he would support higher rates if inflation progress stalls. Waller sounded optimistic about inflation trends.
After his comments, markets changed their expectations. Odds of a rate hike fell to about 50% from 63%.
Stocks rose and bond yields fell after his remarks. This happened because investors saw a smaller chance of a hike.
Before Waller spoke, Kevin Warsh's speech had raised hike expectations. Warsh spoke at an economic conference in Jackson Hole, Wyoming.
A rate increase this month remains possible. The Federal Reserve is still waiting for the next inflation report.
Key Terms 4
- Federal Reserve The US central bank that sets interest rates.
- Christopher Waller A governor of the Federal Reserve.
- rate hike Raising the cost of borrowing money.
- Jackson Hole A town in Wyoming that hosts a major economic conference.