Waller Hints at Rate Hike as August Inflation Data Takes Center Stage

US Federal Reserve Governor Christopher Waller emphasized that the upcoming inflation data for August will play a significant role in determining whether interest rates remain unchanged or are raised at the central bank's September meeting.

The FOMC is scheduled to meet on September 15 and 16, and Waller said that his decision on the appropriate monetary policy stance will be heavily influenced by the inflation data for August.

He noted that while recent data has shown some signs of easing inflation, the upcoming numbers will be crucial in deciding the next policy move. If inflation continues to trend towards the Fed's 2% goal, Waller would support keeping interest rates at their current level.

However, if inflation comes in above expectations, he would consider raising interest rates to combat rising prices. As of now, inflation remains meaningfully above the Fed's target, but recent data suggest that price pressures are gradually easing, with the three-month core inflation rate standing at 3.05% through July.

Waller also highlighted potential risks that could push inflation higher, including rising energy prices and increasing technology goods prices linked to the expansion of artificial intelligence and further tariff increases.