F
ederal Reserve Governor Christopher Waller is pushing for a short-term interest rate cut at the central bank's July meeting, and isn't ruling out another cut later this year. The debate over whether to lower rates has intensified, with some Fed officials supporting a cut despite Chairman Jerome Powell's repeated defense of keeping rates frozen since December 2024.

    Waller believes the economy is in a good position for a rate cut, citing soft real GDP growth, low unemployment, and near-target inflation rates as reasons. He also expressed concerns about private sector employment, which he sees as another reason to lower rates soon. Waller argued that uncertainty over tariff impacts should not hold back the Fed, saying tariffs are one-off price increases that don't cause long-term inflation.

    Waller's stance is in line with a majority of Federal Open Market Committee members who last month believed it would be appropriate to reduce the policy rate at least twice this year. With only four meetings left before the end of 2025, time is running out for a cut. Waller suggested cutting rates by 25 basis points at the July meeting and potentially again later in the year if inflation remains under control.