Fed’s Waller: Not enough data to change his mind on need for rate hike at early November meeting The Fed

By Greg Robb

Don’t expect the September jobs or inflation data later this month to change any Federal Reserve official’s mind about the need for another large rate hike in November, Fed Governor Christopher Waller said Thursday.

The government will release the September payroll employment report on Friday, followed by consumer prices and PCE price data later this month.

“Before the next meeting on Nov. 1-2, there is not going to be a lot of new data to cause a big adjustment to how I see inflation, employment and the rest of the economy holding up. I don’t think that this extent of data is likely to be sufficient to significantly alter my view on the economy,” Waller said, in a speech at the University of Kentucky.

“I expect most policymakers feel the same way,” Waller added.

The Fed governor noted that the Fed’s latest projections on monetary policy, known as the “dot-plot,” indicate the internal debate at the November meeting will be about either another 75-basis-point hike or slowing to a 50-basis-point move.

He didn’t handicap the outcome.

“I imagine we will have a very thoughtful discussion about the pace of tightening at our next meeting,” he said.

Speculation on cable business-news channels and in the press that the Fed might slow rate hikes, or even halt them earlier than expected because of financial stability concerns, seems misplaced, Waller said.

“This is not something I’m considering, or believe to be a very likely development,” he said.

Waller said he was “a little confused” about this speculation. From his perspective, markets are operating effectively, he said.

“I anticipate additional rate hikes into early next year,” Waller said. At another point, he said “the Fed should be 100% focused on reducing inflation,” he said.

So far, the Fed hadn’t made “meaningful progress” on inflation, Waller said.

“Until that progress is both meaningful and persistent, I support continued rate increases, along with ongoing reductions in the Fed’s balance sheet, to help restrain aggregate demand,” he said.

Stocks /zigman2/quotes/210598065/realtime DJIA +0.34% /zigman2/quotes/210599714/realtime SPX +0.59% closed down on Thursday on concern after a slew of Fed speakers beat the drum for continued rate hikes. The yield on the 10-year Treasury note /zigman2/quotes/211347051/realtime BX:TMUBMUSD10Y -1.31% rose to 3.82%.