Waller

  • Politics should be above neutral by the end of the year
  • I’m not taking 50 basis points off the table until inflation approaches the Fed’s 2% target
  • Balance sheet reduction equivalent to some 25 basis point hikes
  • I am optimistic that the strong labor market can support higher rates
  • I don’t know how soon the supply chain issues will subside
  • Inflation is “alarming”
  • Longer-term inflation expectations have reached a level consistent with inflation
  • I don’t expect the decline in GDP in the first quarter to be repeated

It’s hawkish stuff with talk of “several” 50 basis point hikes from the 50/50/25/25 baseline endorsed by other Fed officials. That said, Waller is a hawk so it’s not entirely surprising.