Fed's Waller says September rate decision hinges on August inflation data

Federal Reserve Governor Christopher Waller signaled a strong preference for holding the federal funds rate steady at the September meeting, contingent on the upcoming inflation data, with disinflation he wants to see continuing in August. He noted that the PCE inflation gauge has cooled from February levels, contributing to room for a pause, but warned that a hotter-than-expected August print could push him toward a rate hike to keep price progress on track to 2%. Markets reflected the uncertainty, with rate-hike odds and asset prices moving in response to his remarks as traders awaited August data. Several reports emphasize that Waller remains patient, suggesting policy is only mildly restrictive and that a further shift would hinge on inflation momentum toward the 2% target. Analysts and commentators also point to external factors like tariffs and energy prices as ongoing influences on inflation, complicating the path to easing. Overall, the narrative across the coverage is that the September decision will be data-driven, with the August report acting as the decisive trigger for any policy tightening or continued pause.