Federal Reserve Governor Christopher Waller supported a 25-basis-point interest rate hike at the Federal Open Market Committee's (FOMC) meeting in December. He mentioned that a larger increase of 50 basis points may be needed if inflation stays high in October. Waller made these remarks during a speech in London on November 10, 2026.
Key Details
Waller stressed the importance of the upcoming inflation data. He said, "If inflation does not improve from September, I believe a 50 basis point hike in the policy rate should be considered at the December meeting." He added that raising rates by only 25 basis points could harm the Fed's credibility, which he does not want to risk.
Two other FOMC members, Dallas Fed President Lorie Logan and Minneapolis Fed President Neel Kashkari, also called for a stronger approach on interest rates. Their comments suggest that several officials agree on tightening monetary policy to fight inflation. Market participants are closely watching the consumer price index (CPI) data coming soon, as it will influence the Fed's decisions.
Background
Waller's statements have created a cautious mood in the markets. Wall Street futures showed mixed results after his comments. Investors are especially focused on the inflation figures, which will be key in shaping the Fed's policy direction.
Related coverage: Bank of England Raises Rates to Combat Rising Inflation, Bank of England Expected to Raise Rates to 4% This Week.
A possible rate hike by the Fed could affect bond yields and stock markets. This is especially true for sectors sensitive to interest rates, like financials and real estate. Investors are likely to respond to any signs of ongoing inflation, which could lead to further tightening of monetary policy. Keep an eye on the upcoming CPI release, as it will provide important insights into inflation trends.
Based on reporting by: moneycontrol.com