Fed’s Waller Supports 0.75-Percentage-Point Rate Hike in July


Governor Christopher Waller says the Fed took a significant step toward achieving its inflation goal when it raised its key interest rate by 0.75 percentage point on Wednesday.


Bess Adler/Bloomberg News

Federal Reserve governor

Christopher Waller

said that if the economy performs in line with his expectations, he would support raising interest rates by another 0.75 percentage point at the central bank’s meeting next month.

“The Fed is ‘all in’ on re-establishing price stability,” Mr. Waller said in remarks prepared for delivery at a conference in Dallas on Saturday.

Mr. Waller said the Fed had taken a significant step toward achieving its 2% inflation goal this past week, when it raised its benchmark rate by 0.75 percentage point to a range between 1.5% and 1.75%.

The increase was larger than the half-point rate rise that most officials had said they expected two weeks ago after officials concluded new data on inflation and consumer expectations of future inflation had worsened.

The Fed’s preferred inflation gauge, the personal-consumption-expenditures price index, rose 6.3% in April from a year earlier, near a 40-year high.

Mr. Waller devoted most of his remarks Saturday to an analysis of how, with the benefit of hindsight, the Fed’s promises to keep interest rates low after the pandemic-induced recession in 2020 might not have allowed enough flexibility for the central bank to adapt sooner to changing circumstances in 2021.

Write to Nick Timiraos at nick.timiraos@wsj.com

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Source link