The Fed’s Waller Supports Another Rate Cut Amid Weak Labor Market – Here’s How Markets Are Reacting

The governor of the U.S. Federal Reserve, Christopher Waller, said he supports another interest-rate cut at the upcoming FOMC meeting on December 9–10. He noted that weakness in the labor market and the slowdown in hiring call for additional action. Waller emphasized that inflation does not pose a risk and that a quarter-point cut would act as “insurance” against further deterioration in the job market.

His comments come at a time when the Fed is divided: some officials warn that another cut could reignite inflationary pressures, while others focus on easing monetary policy to support consumers and employment. Waller stressed that although government data has been limited during the recent shutdown, available private and public data provides enough information for an informed decision.

Expectations for a rate cut are already being reflected in the markets: investors are buying equities in anticipation of cheaper financing and stimulative conditions for investment. This is lifting support for indexes such as the S&P 500 and Nasdaq, bolstering optimism ahead of key employment reports and upcoming labor-market data.