Woller sets the tone for Tuesday's CPI: Hot inflation will support recent interest rate hikes

OdailyJul 13, 2026
#Macro
Federal Reserve Governor Christopher Waller said on Monday that the Fed may need to raise interest rates “in the near term” if upcoming data indicates that inflation remains significantly above its 2% target. He described current monetary policy as being at a “crossroads.” Waller noted that the direction of policy will be determined by new information, such as Tuesday’s CPI report; if the data takes an unfavorable turn, the Fed is currently in a phase where it should not “rest on its laurels.”

Waller stated: “At the current policy stance, inflation could still gradually decline toward the 2% target. However, I am equally concerned about an alternative scenario—namely, that data over the coming weeks may show inflation remaining elevated—or even rising further—which would necessitate tighter monetary policy in the near term.” He specifically expressed concern that recent inflation reports suggest price pressures appear to be broadening across the economy, extending beyond the effects of last year’s import tariff hikes or recent energy cost increases, potentially reflecting more widespread, systemic inflation that would require even more restrictive monetary policy.

Waller added, “If core inflation again comes in hot this week, the FOMC will have no choice but to consider tightening monetary policy in the near term. It will take several months of consistently declining inflation data before we can confidently say inflation is moving in the right direction.”

[Odaily]

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Woller sets the tone for Tuesday's CPI: Hot inflation will support recent interest rate hikes

OdailyJul 13, 2026
#Macro
Federal Reserve Governor Christopher Waller said on Monday that the Fed may need to raise interest rates “in the near term” if upcoming data indicates that inflation remains significantly above its 2% target. He described current monetary policy as being at a “crossroads.” Waller noted that the direction of policy will be determined by new information, such as Tuesday’s CPI report; if the data takes an unfavorable turn, the Fed is currently in a phase where it should not “rest on its laurels.”

Waller stated: “At the current policy stance, inflation could still gradually decline toward the 2% target. However, I am equally concerned about an alternative scenario—namely, that data over the coming weeks may show inflation remaining elevated—or even rising further—which would necessitate tighter monetary policy in the near term.” He specifically expressed concern that recent inflation reports suggest price pressures appear to be broadening across the economy, extending beyond the effects of last year’s import tariff hikes or recent energy cost increases, potentially reflecting more widespread, systemic inflation that would require even more restrictive monetary policy.

Waller added, “If core inflation again comes in hot this week, the FOMC will have no choice but to consider tightening monetary policy in the near term. It will take several months of consistently declining inflation data before we can confidently say inflation is moving in the right direction.”

[Odaily]

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