Federal Reserve Governor Christopher Waller refrained on Monday from commenting on the future direction of interest rates, stating that he would balance better-than-expected labor market data against inflation indicators expected to ease throughout the year.
After dissenting in January when the Fed decided to pause its rate-cutting cycle, Waller pointed out that employment data presents a complex picture. Although nonfarm payroll figures for the month exceeded expectations, he suggested that based on other indicators showing weak or flat job growth, the report might contain "more noise than signal."
In his speech, Waller indicated that he would continue to monitor incoming data before the next interest rate decision at the Fed's March meeting. He suggested that the January jobs report could either be a temporary anomaly in a trend of near-stagnant employment growth by 2025 or a signal of an impending rebound.
"There is enough uncertainty in the January data that I need to see the February report on March 6 to determine whether the labor market is rebounding," he stated. "As more data becomes available, I will be able to clarify the current situation and make more prudent policy decisions."
He also expressed the view that last week's Supreme Court ruling against President Trump's "emergency" tariffs as unconstitutional would likely have minimal impact. Waller has long maintained that the inflationary effects of tariffs are temporary and therefore not a factor in his policy considerations.
Waller made these remarks during a conference held by the National Association for Business Economics in Washington, D.C.
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