Fed’s Waller: Further hikes don’t need to come at consecutive meetings

Federal Reserve Governor Christopher Waller discussed the need for additional interest rate hikes during a speech at the TCMB Istanbul Economic Forum on Thursday, despite the Fed's focus on possible policy choices in future meetings. Waller emphasized that inflation remains excessively high, primarily driven by the AI buildout and energy disruptions.

He noted that the economy is improving in the second half of 2026 and that the labor market is stable, despite a decline in jobs created in September. Waller cautioned that persistent high inflation could jeopardize inflation expectations. While the US Dollar experienced minimal movement following Waller's remarks, the pair's value is nearing 102.30.

Waller's hawkish tone, as measured by the FXS Speechtracker score of 8/10, suggests a preference for further rate hikes, even if not in consecutive meetings. The Fed Sentiment Index rose to 138.34, indicating a hawkish stance above the neutral 100 mark. Geopolitical risks, including potential strikes against Iran and increased US bond yields, continue to support the Dollar, while the Euro and Yen face downward pressure.