Waller: Inflation Report Will Decide Fate of September Rate Hike

Fed Governor Christopher Waller says that the upcoming inflation report on September 11 will be crucial in determining whether to raise interest rates later this month or not.

If the August inflation figures show that prices are continuing to cool down, Waller is inclined to keep the Fed's benchmark interest rate unchanged. However, if the inflation data comes out 'hot', he would consider a rate hike.

The government will release the inflation report next week, and Waller emphasized that borrowing costs are only 'slightly restricting' consumer and business demand.

This statement suggests that a rate hike later this month is not a done deal, as several members of the Fed's rate-setting committee have voiced concerns about price increases still being too high. On the other hand, some Fed officials, including Chair Kevin Warsh, have suggested that inflation has not shown sufficient improvement and that further action may be necessary.