Waller Hints at Rate Hike Uncertainty Ahead of Inflation Report

Federal Reserve Governor Christopher Waller says the upcoming inflation report will determine whether he supports an interest rate hike later this month or not. The government is set to release August inflation figures on September 11, and if they show that inflation continues to cool, Waller would be inclined to keep the Fed's benchmark interest rate unchanged.

However, if the inflation report shows that prices are rising rapidly, Waller would consider a rate hike. He believes that borrowing costs are still only 'slightly restricting' consumer and business demand, but thinks it may not take much acceleration in inflation to nudge him into supporting a rate hike.

This uncertainty has caused stock prices to rise and bond yields to fall. Several members of the Fed's rate-setting committee have voiced concerns that price increases are still too high, suggesting that a rate hike may be needed.