As part of the White House’s hunt for a new chair, Fed Governor Christopher Waller is scheduled to meet with President Donald Trump later Wednesday.
Christopher Waller, the governor of the Federal Reserve and a candidate on President Donald Trump’s shortlist to be the next Fed chair, stated that there is potential for significant rate decreases and that inflation will moderate in the upcoming months.
“I don’t really worry about inflation. In a speech at Yale University, Waller stated, “It’s above target, but I believe it will start coming down in the next three to four months.”
Waller stated that while he anticipates employment growth to improve in the upcoming year, he is concerned about the labor market’s short-term prospects.
Fed Chair Jerome Powell indicated the bar was high for additional rate reduction last week when the Fed lowered rates for the third consecutive meeting. Only one rate drop is anticipated in 2026, according to Fed policymakers’ median prediction.
According to Waller, growth is still under pressure to decline at the current rate level. According to him, the Fed may lower rates by “50 to 100 basis points” in order to bring them below 3%. According to him, growth isn’t being slowed at that level.
Waller stated, “We can go at a moderate pace,” but he wasn’t sure if his central bank colleagues would support this strategy.
A neutral fed-funds rate, according to many Fed officials, is higher than 3%.
As part of the White House hunt to replace Powell, whose tenure expires in May, Waller will meet Trump later today, according to the Wall Street Journal.
Waller has a slim chance of becoming the top Fed official, according to the betting markets. Although the markets have been erratic, former Fed governor Kevin Warsh and White House economic adviser Kevin Hassett are thought to have greater prospects of becoming the next Fed chair.
Trump will choose a new chairperson in January, according to Treasury Secretary Scott Bessent’s statement on Tuesday.
