- Fed Governor Christopher Waller advises a cautious approach to future interest rate cuts.
- He cites data on employment, income, and persistent inflation as reasons for caution.
- After a recent 50-basis point rate cut, a smaller cut is expected next month.
Waller commented that the Federal Reserve should slow down after last month’s significant interest rate cut. He indicated that upcoming cuts might be less aggressive due to signs of a robust economy. Waller noted the importance of not overreacting to recent data, emphasizing a need for caution moving forward.
He highlighted strong recent economic indicators, such as solid employment figures and a slight uptick in inflation, suggesting the economy isn’t slowing as much as hoped. September’s job report showed better numbers, and the GDP growth in the second quarter was revised up.
Waller plans to closely monitor upcoming data on inflation and the labor market before making further decisions on rate cuts. Current market expectations are for a smaller rate cut in November, with a total of about 125 basis points forecasted for next year.
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