Waller Urges Fed To Cut Rates Before It’s Too Late

Two weeks before a crucial Federal Reserve meeting, the governor, expected to succeed Jerome Powell in 2026, stood out with an unambiguous statement. He wants a rate cut as early as September. In an interview granted to CNBC, he affirmed that the American economy demanded an immediate adjustment, thus breaking with the caution shown by other monetary officials.

Waller wants to trigger the cut

While the Fed faces a dilemma : keep rates or cut them, Christopher Waller left no ambiguity about his position during his intervention.

“I think we need to start cutting rates at the next meeting“, he declared bluntly.

A member of the Fed Board of Governors, Waller carries significant political weight within the institution. His statement comes at a time when US economic indicators begin to show signs of slowing, especially in the labor market.

And for him, that is precisely where the urgency lies : “when the labor market turns, it does so sharply“, he emphasized, advocating for preventive action.

In his argument, Waller calls for a flexible approach, avoiding any rigid long-term commitment. He stresses the Fed’s ability to adjust the pace of cuts based on the evolution of on-chain data.

He specifies : “we don’t need to commit to a locked sequence of measures. We can observe how the situation evolves“. This positioning contrasts with the caution observed in recent meetings and highlights several key points :

• Anticipation rather than reaction : act before tensions in the labor market become critical ;

• Strategic flexibility : avoid an automatic downward trajectory in favor of an adaptable policy ;

• Distance from tariff-driven inflation : “I am not worried, but others still are“, he acknowledged, highlighting internal divergences ;

• Decisive timing : two weeks away from a key meeting, his comments aim to influence the internal Fed debate.

A stance that goes beyond the immediate situation

This media appearance by Waller is not just a simple economic opinion. It fits into a global political context, as his name is actively circulating among favorites to replace Jerome Powell as Fed chair in February 2026.

This prospect gives additional weight to his remarks. By positioning himself so clearly, Waller lays the groundwork for a medium-term strategic orientation : a potentially more proactive, even more flexible Fed, in a context of global macroeconomic uncertainty.

The man also nuanced the reasons usually invoked to maintain high rates, especially concerns related to inflation imported through tariffs. “People are still worried about tariff-related inflation. I am not, but others are“, he said, revealing a split within the central bank itself.

This internal disagreement could strengthen debates at the next monetary policy meeting, especially since geopolitical tensions and uncertainties about global growth leave little room for error.

For financial markets, this stance opens several hypotheses : either the Fed follows Waller and starts a loosening cycle, as anticipated by the banking institution Goldman Sachs, which could support risky assets, including cryptos, or it remains cautious for a while longer, risking to see some macroeconomic indicators deteriorate faster than expected.