Federal Reserve Governor Christopher Waller conveys his favor for raising rates at July FOMC meeting per the prepared remarks for delivery before a gathering held by The Money Marketeers of New York University shared by Reuters.
The policymaker also showed his hesitance to call an all clear on US inflation and favors more rate rises this year
“The robust strength of the labor market and the solid overall performance of the U.S. economy gives us room to tighten policy further,” said Fed’s Waller.
Fed’s Waller cited example of 2021 summers, when the inflation briefly slowed before getting much worse, to tame the fears emanating from this week’s downbeat US inflation clues.
Additional comments
Fed likely to need two more 25 basis point rate hikes this year.
Banking sector is strong and resilient.
Bulk of past rate hikes already have impacted economy.
Market implications
The aforementioned headlines join the early-Asian session consolidation to allow the US Dollar to take a breather. That said, the US Dollar Index (DXY) licks its wounds near the lowest levels since since April 2022 the previous day, down 2.45% on a week so far, as downbeat inflation clues from the US push back the Federal Reserve (Fed) hawks.
Also read: Forex Today: Dollar's downward spiral continues
Update
Following the initial statements, mentioned above, Reuters unveiled additional comments suggesting that Fed’s Waller flags fears of soft landing while citing the US central bank’s efforts to tame inflation. That said, the policymaker cites job market and economic strength as the biggest victims of rate hikes, per the news.
Fed's Waller also suggests that two more softer prints of the Consumer Price Index (CPI) can flag the policy pivot while also adding that September meeting is a live monetary policy meeting.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD climbs back above 1.0750 ahead of ADP, Fed Minutes
EUR/USD has regained lost ground above 1.0750 in the European session on Wednesday. The pair draws support from the renewed US Dollar weakness, in the aftermath of the dovish Fed Chair Powell's comments. Eyes turn to US ADP data, Fed Minutes.
GBP/USD retakes 1.2700, looks to US data/Fed minutes
GBP/USD is battling 1.2700 in European trading on Wednesday, attempting a modest bounce. Traders appear reluctant and prefer to wait on the sidelines ahead of the FOMC minutes while the UK elections on Thursday also keep them on the edge. US ADP data eyed as well.
Gold jumps toward $2,350, with eyes on key US events
Gold price is closing in on $2,350 in the European trading hours on Wednesday, staging a rebound amid a fresh leg down in the US Dollar. Gold price capitalizes on dovish Fed Chair Powell's remarks on Tuesday, which added to the September rate cut expectations. US ADP data and Fed Minutes on tap.
Bitcoin price struggles around $61,000 as German government transfers, miners activity weigh
U.S. spot Bitcoin ETFs registered slight outflows on Tuesday. The German Government transferred another 832.7 BTC, valued at $52 million, on Tuesday.
ADP Employment Change Preview: US private sector expected to add 160K new jobs in June
The United States ADP Research Institute will release its monthly report on private sector job creation for June. The announcement is expected to show that the country’s private sector added 160K new positions in June after adding 152K in May.