Top Fed official backs new rate cuts even if Trump tariffs materialize A top policymaker at the U.S. Federal Reserve said Wednesday that he still supports cutting interest rates this year, despite elevated inflation and the prospect of widespread tariffs under the incoming Trump administration.
Waller also suggested he is more optimistic about inflation than many Wall Street investors, who increasingly expect the Fed to keep its rate steady this year as elevated prices continue to linger.
Christopher Waller, an influential member of the Fed's board of governors, said he expects inflation will move closer to the Fed's 2% target in the coming months.
While inflation has been persistent in recent months — it ticked up to 2.4% in November, according to the Fed's preferred measure — Waller argued that outside of housing, which is difficult to measure, prices are cooling.
And in some of the first comments by a Fed official specifically about tariffs, he said that greater import duties likely won't push up inflation this year.
