Waller signals willingness to act By Investing.com

Investing.com – Federal Reserve Governor Christopher Waller said on Friday that recent economic data warrants an early rate cut by the Federal Reserve. Speaking at the University of Notre Dame, Waller pointed to recent jobs data that suggest a continued slowdown, but not an imminent recession.

“The labor market data confirm the long-term trend of a slowdown accompanied by moderate economic growth,” said Waller. Despite this slowdown, he sees no signs of a recession or a new economic crisis.

Waller stressed that the Fed is prepared to act quickly and decisively at the right moment. A rate cut is certainly possible, but the decision will be based on current data, not on speculation about the timing of monetary policy measures.

It went on to say that the US Federal Reserve may need to “bring forward” interest rate cuts, a comment that suggests interest rates could fall as much as 50 basis points at the next meeting in September.

Analysts consider Waller’s choice of words to be cautious. “Similar to Fed Chairman Powell in Jackson Hole, Waller is showing a dovish attitude and sees the slowdown in the labor market as a signal for possible interest rate cuts,” say the experts at Vital Knowledge. They believe a cut of 50 basis points is likely for the September meeting. Economists at Citi also share this assessment and expect a major interest rate cut at the meeting on September 18.