Fed's Waller (voter) says if there is another hot reading on core inflation this week, the Fed will need to consider rate hike in near term

Newsquawk Staff · 13 Jul 2026, 16:49 UTC

Would need to see several months of lower core inflation to feel inflation is moving in right direction.
Concerned about elevated pace of core inflation.
Still a credible case for inflation to fall back to 2% without higher rates.
Committed to returning inflation to 2% target; also to avoid over-tightening policy and risking recession.
Concerned about equally plausible case that tighter policy will be needed.
Expects a deceleration in headline inflation starting with this week's inflation data; but will be focused on core reading.
Real side of economy in good shape.
Determined to avoid repeating Fed's mistake in 2021; but labour market not as tight now, and inflation expectations anchored.
Household, business spending resilient despite higher goods costs from tariffs, energy price surge from Middle East conflict.
Tariffs, energy prices, and demand from AI buildout are factors in upward pressure on inflation.
Earlier concerns that higher oil prices could push up prices more broadly have greatly diminished.
Labour market stable, close to Fed's maximum-employment goal.
Expects solid consumer spending growth and strong AI-related investment to continue.
Labour market not a source of inflationary pressure, or a concern for strength of economic expansion.
Recent increases in core inflation are quite broad.

What our latest note said

US Market Open, 22 Oct, 10:37 UTC · what it led with

Iran's IRGC Navy warned that US efforts to encourage passage could result in strikes on US bases.
Iran's Major General Rezaei said Iran has presented seven new conditions through mediators and will neither reopen the Strait of Hormuz nor resume negotiations until they are met.

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