Christopher Waller leans toward steady interest rates at next Federal Reserve meeting
Federal Reserve Governor Christopher Waller indicated a preference for keeping interest rates steady at the central bank's next policy meeting. Waller stated that current inflation trends suggest signs of disinflation, and if upcoming data confirms these cooling pressures over the next two weeks, he would be inclined to support holding the federal funds rate at its current setting. Waller noted that inflation remains meaningfully above the 2% target. He also observed that the premium for safe, liquid U.S. government debt has largely disappeared, which has led him to raise his neutral rate estimate. He suggested that for the United States to grow out of its $40 trillion debt, structural deficits would need to be brought closer to zero percent of GDP. Following his remarks, Treasury yields moved lower across the curve. The 10-year Treasury note yield fell more than 2 basis points to 4.772%. The 30-year Treasury yield dropped more than 1 basis point to 5.254%. The 2-year Treasury note yield was more than 4 basis points lower at 4.342%.
Sources
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Fed's Waller says safety premium for Treasuries is gone, pushing neutral rate higher
Yahoo Finance
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Fed's Waller channels his inner John Lennon with a plea to 'give disinflation a chance'
Reuters
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Treasury yields fall after Fed's Waller signals support for no rate hike
CNBC