Federal Reserve Governor Waller delivered a public speech at the Economic Forum in Istanbul, Turkey on October 8 local time.
Waller stated that further interest rate increases may still be necessary in the future to curb inflation and bring it back down to the 2% policy target level as soon as possible.
This stance is similar to views recently expressed by other senior Fed officials.
Multiple officials have indicated that the Fed still has time to assess economic conditions before considering the next rate hike.
Waller said at the forum that day that the current inflation problem cannot be ignored.
U.S. inflation has been above the 2% target for nearly five and a half years, and prices have recently accelerated upward again.
Multiple factors are dragging down the disinflation process: the Middle East conflict shows no sign of ending in the short term; the rapid development of the global artificial intelligence industry is pushing up prices of high-tech consumer goods due to chip shortages; and ongoing trade conflicts could spawn new tariffs, continuing to put upward pressure on prices.
Waller also touched on the Fed's quarterly dot plot in his remarks.
He mentioned that the dot plot released at the September policy meeting can reflect each official's judgment on the rate path; among the 18 officials who submitted projections, the vast majority expect one more rate hike within 2026.
Interpretation of the 2027 dot plot should not be oversimplified, as some officials' projections reflect the possibility of hiking first and cutting later, with 8 officials believing the rate level will be higher than current levels by the end of 2027.
The market widely expects the Fed to "stay put" this month. On October 7, the Fed released the minutes of its September monetary policy meeting.
The minutes showed that all 19 Fed officials at the time supported raising the federal funds rate target range by 25 basis points to 3.75% to 4%.
However, after weaker-than-expected U.S. employment data following the meeting and signals from multiple Fed officials that there is "no need to rush to hike," the market now generally expects the Fed is more likely to "stay put" this month and hike again in December.
Data from CME Group's "FedWatch" tool shows that investors expect the probability of the Fed keeping rates unchanged at this month's policy meeting to exceed 82%; the probability of a 25 basis point hike in December has risen to 72.8%.
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