Fed Governor supports another rate cut as US job market weakens

Federal Reserve Governor Christopher Waller said Monday he favors a third straight interest rate cut in December, citing a labor market that has weakened for months and is now close to stalling. 

Speaking at an event in London, Waller said he does not expect upcoming data — including the delayed September jobs report — to change his view that another 25-basis-point reduction is warranted. 

He described the move as necessary “insurance” against further deterioration in employment, noting that companies have recently begun planning layoffs after a period of “no hire, no fire” behavior.

The Fed lowered rates in September and October after holding them steady for most of the year, though Chair Jerome Powell has stressed that a December cut is not guaranteed. Waller, considered a potential successor to Powell when his term ends in 2026, argued that further easing is prudent risk management given that the labor market remains fragile. 

He added that President Donald Trump’s tariffs appear to have only temporary inflation effects, and warned that strong stock market gains mainly benefit a small group of wealthy consumers, leaving broader financial conditions vulnerable. 

Fed Vice Chair Philip Jefferson, meanwhile, urged caution earlier Monday, saying policymakers should move slowly amid shifting economic risks.