Waller signals more rate hikes in Istanbul

Speaking at the Istanbul Economic Forum, hosted by the Central Bank of the Republic of Türkiye (CBRT), Waller said he expects further monetary tightening if economic data continue to develop in line with expectations. However, he emphasized that the Fed has flexibility over the timing of rate increases and does not need to raise rates at every meeting. His remarks followed the Fed’s 25-basis-point rate hike in September, which lifted the policy rate to 3.75–4.00%, reinforcing expectations that rates could remain unchanged in October before another potential increase in December.

Waller pointed to signs of strengthening US economic activity in the second half of the year and said he was not overly concerned that restrictive monetary policy would cause a significant slowdown. However, he expressed concern that persistently above-target inflation and its recent acceleration could lead consumers and businesses to revise their inflation expectations upward. He warned that energy price shocks stemming from the Middle East and additional demand driven by artificial intelligence investments could intensify inflationary pressures. Waller stressed that future monetary policy decisions would depend on incoming economic data. The Fed’s September economic projections had also indicated that most officials considered another rate hike appropriate before the end of 2026.