World Economy

Fed's Waller Signals December Rate Increase Likely, Hints at Larger Move if Inflation Rises

Federal Reserve Governor Christopher Waller said Tuesday the central bank must follow through on promised interest rate increases to preserve its credibility with markets. Speaking in London, Waller expressed support for a quarter-point rate hike in December, with potential for a larger half-point increase if inflation data exceeds expectations. The policymaker emphasized that while the timing of individual rate moves is less critical, executing previously communicated hikes within a reasonable timeframe remains essential. Waller noted the Fed's October decision to hold rates was appropriate if subsequent tightening follows market expectations. He cautioned that failing to implement promised increases would damage Fed credibility and prompt markets to reduce rate-hike expectations, inadvertently loosening monetary policy.