Waller says he will not prejudge the remaining two meetings this year; report says October the probability of a rate hike fell to approximately 17%

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Waller refused to prejudge the remaining two interest-rate decisions this year,October the probability of a rate hike fell to approximately 17%

BlockBeats reported that October 16, Federal Reserve Chair Kevin Waller October 16 said while attending the IMF conference in Bangkok that he would not prejudge the outcomes of the remaining two rate-setting meetings this year, nor would he disclose in advance what action might be taken. He said: “This is a new chapter for the Federal Reserve; we no longer do this.” Regarding the signal recently sent by his colleagues that there was no rush to raise rates this month, he neither explicitly supported nor rebutted it.

Waller reiterated that the Federal Reserve would achieve price stability, adding that since September the rate hikes, the global economy has broadly developed in line with central-bank expectations. He described the recent actions of central banks as synchronized monetary tightening across most of the world. The Federal Reserve September unanimously raised rates by 25 basis points, lifting the federal funds target range to 3.75%to 4%, when most officials expected at least one more rate hike this year.

Although September core CPI rose month-on-month by 0.33%, recording a strong increase for the second consecutive month, and the latest producer-price data were also robust, Waller barely discussed this week’s inflation report and made no apparent attempt to alter market expectations for the October meeting. Reports said that during his speech USD fell, and market bets on a October rate hike fell from approximately 30%to approximately 17%。

From a policy-signals perspective, this is better interpreted as preserving decision-making flexibility rather than as an explicit dovish shift. Waller did not signal the next rate hike, but neither did he promise to stop tightening or shift to rate cuts. The speech continued the communication approach of reducing forward guidance; market bets on a October pause in rate hikes cannot be equated with a decision already made by the Federal Reserve.

In addition, Waller said that the United States is experiencing a surge in investment and expressed optimism about economic resilience and the productivity gains brought by AI but warned that the path ahead would be “very bumpy”;AI the short-term impact on employment remains unclear.

Wei Liang Chang, a macro strategist at DBS Bank, commented on Waller’s latest remarks: “Hearing Waller reiterate his belief that artificial intelligence will boost productivity over the medium term could help ease inflation expectations and reduce concerns about consecutive rate hikes by the Federal Reserve, leaving the market reassured.USD and U.S. Treasury yields may decline slightly, but broader price movements will still depend on whether U.S. stocks remain stable tonight.”