Fed's Waller makes an argument for July rate cut

Federal Reserve (Fed) Board of Governors member Christopher Waller made another push for why the Fed should deliver an early rate cut in July. During a speech at the Dallas Fed, Waller noted that tariff inflation effects are likely to be short-lived, and stipulated that a rate cut here would not be politically motivated.

Fed Governor Waller is one of the possible favorites expected to replace Fed Chair Jerome Powell in 2026.

Key highlights

Tariffs increases prices one time, central banks can look through that.

Tariff effects not zero but are not large either.

Waller has been arguing that a pretty restrictive policy rate can come down.

Unemployment is around the long run level.

Waller reiterates case for why July rate cut could happen.