Waller says recent data gives Fed space to decide next rate move, CNBC reports
By Michael S. Derby
(Reuters) -Federal Reserve Governor Christopher Waller said on Tuesday the latest round of economic data was giving the U.S. central bank space to see if it needs to raise interest rates again, while noting that he currently sees nothing that would force a move toward boosting the cost of short-term borrowing again.
Recent economic news is «going to allow us to proceed carefully,» Waller said in an interview with CNBC, adding that «there's nothing that is saying we need to do anything imminent anytime soon, so we can just sit there, wait for the data, see if things continue» on their current trajectory.
On Friday the U.S. Labor Department reported that the economy continued to gain jobs at a solid clip in August even as the unemployment rate shot up to 3.8% from 3.5% in July. That data was released during a week where there was fresh news on inflation, as markets continue to debate the need for more monetary policy tightening to tame inflation.
In recent days Fed officials have said that while inflation is still too high, it is coming down, and they have said that any move to lift the range for the benchmark overnight interest rate depends on the data. The Fed last raised rates in late July, pushing its policy rate to the 5.25%-5.50% range. It has raised that rate from the near-zero level since March 2022.
Financial markets believe the Fed's rate hikes are over. But Waller cautioned against making such an assumption, noting that the Fed has been burned before by data that appeared to show an improvement on the inflation front only to see price pressures come in stronger than expected.
Whether interest rates go up again «depends on the data. I mean, we have to wait and see if this inflation trend
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