Fed Gov. Waller Says Inflation Supports September Hike, Not a Fast Pace

Federal Reserve Gov. Waller said Thursday that recent inflation data supported the central bank’s September rate hike, but policymakers do not need to raise rates at every meeting if further increases are needed.

Waller said the decision followed several months of evidence, including stable labor-market conditions, stalled inflation progress and higher energy prices linked to conflict in the Middle East. Trade tensions, new tariffs and higher technology-related consumer prices also added pressure.

Core personal consumption expenditures inflation rose 3% year over year in August, remaining above the Federal Reserve’s 2% target. Waller said the latest data reinforced a policy focus on inflation while the labor market remains stable.

He said additional increases could be appropriate if the data meet expectations, but the pace and size of any moves should remain flexible. Any tightening would not have to occur in consecutive meetings, as long as it is delivered within an acceptable period.

The Federal Reserve cut rates by a combined 75 basis points from September through December 2025. Its September 2026 projections showed 16 of 18 participants expecting at least one more increase this year, while four projected two additional increases.