Fed’s Waller: March can’t be completely ruled out for a rate cut

Investing.com — Federal Reserve Governor Christopher Waller said in an interview with CNBC on Thursday that the December inflation data was very good and that if data persists along the same lines, we may see rate cuts in the first half.

“If inflation data comes in as it has, I’d expect a cut in the first half of the year,” he said.

Waller added that he doesn’t think a cut in March can be ruled out and that if inflation moves lower, there may be more cuts that the market currently sees, noting that three or four cuts could be possible this year “if the data cooperates.”

While cautioning that he may be more optimistic than his colleagues at the Fed, Waller said inflation was back to trend, and he believes it will come in towards the target. 

Assessing the recent jobs report, Waller said the strong data was a makeup from weaker earlier reads and that when assessing all of the indicators, the employment market is solid but not booming.

However, while Waller cautioned that future data could disrupt the outlook, he added that incoming President Trump’s potential tariffs may not lead to higher inflation. 

Furthermore, Waller does not see the tariffs as having a huge impact on inflation.