There are still two weeks left until the monetary policy meeting scheduled for the 17th to 18th of this month, and some senior officials from the Federal Reserve have already shown their decision-making tendencies.

On Monday, December 2, Eastern Time, Federal Reserve "heavyweight" voting member Waller, who has long held voting rights in the Federal Open Market Committee (FOMC) during his tenure, expressed that he is inclined to support another rate cut at this month's FOMC meeting, but if the data released before the meeting changes his outlook on inflation, he may support keeping rates unchanged and pausing action.

John Williams, the president of the New York Federal Reserve, stated that given the inflation and employment risks have become more balanced, officials may need to lower interest rates further to shift the policy to a neutral stance. However, Williams did not disclose whether he would support a rate cut when policymakers meet later this month, saying decisions will be made at the meeting.

Waller: Leaning towards continuing to lower interest rates in December, though progress in reducing inflation may be 'stagnating.'

Waller spoke at a monetary policy forum hosted by the American Institute for Economic Research (AIER):

“Based on the economic data and forecasts available today, inflation will continue to decline, reaching 2% in the medium term. Currently, I am inclined to support lowering the policy interest rate at the December meeting. However, this decision will depend on whether the data we receive before this meeting unexpectedly rises and changes my forecast for the inflation trend.”

Waller cited recent data suggesting that progress in reducing inflation may be "stalling." He acknowledged that recent data raises concerns that the decline in inflation may not continue but also mentioned that "there is no indication" that prices in major service sectors should remain at current levels or rise.

Waller believes there is still "some distance" between the policy interest rate and the neutral level. He expects that the Federal Reserve will continue to lower rates over the next year to reach the neutral level. Waller stated that he will closely monitor the upcoming employment and inflation data. Even if the pace of inflation declines slows down, the overall economic health leads him to believe that the Federal Reserve is suitable to continue easing monetary policy.

Waller said: "After we (first) cut rates by 75 basis points, I believe there is strong evidence that the (monetary) policy is still very restrictive, and another rate cut would only mean that we will not slam the brakes as hard as before. Another factor supporting further rate cuts is that the labor market seems to finally be regaining balance, and we should strive to maintain this balance."

The inflation indicators favored by the usa Federal Reserve, released last week, show inflation accelerating, giving Fed decision-makers reason to be more cautious about interest rate cuts. In October, the core PCE price index year-on-year increased from 2.7% in September to 2.8%, the highest growth rate since April; the PCE price index year-on-year increased by 2.3% in October, compared to 2.1% in September, both growth rates met expectations.

Due to the impact of two hurricanes and the boeing strike, the non-farm payrolls for October released last month dropped to 0.012 million, the lowest level since 2020, and far below the analyst expectation of 0.1 million. This Friday, the significant November non-farm payroll report will be released. Waller expects the November non-farm payroll report to indicate a rebound in new job additions.

Federal Reserve's number three official, williams, did not disclose whether he supports a rate cut in December, stating that more cuts are needed.

william, the number three official of the Federal Reserve and president of the New York Fed, stated on Monday that given the risks of inflation and employment have become balanced, Fed officials may need to further cut rates to shift the policy stance to neutral. williams did not disclose whether he would support a rate cut in December, but stated that decisions would be made on a meeting-by-meeting basis.

williams stated that the Fed's interest rate path should still be data-dependent. More data can be obtained before the December FOMC meeting. He would consider 'all' data when making rate decisions.

williams stated that he believes the monetary policy 'remains restrictive.' As inflation continues to move closer to the Fed's target, a certain degree of restrictiveness in monetary policy is appropriate. If the economy develops as he expects, policy should be loosened. No signs indicate that the usa economy is heading for a recession.

This year's votary Bostic: open attitude towards December interest rate decisions.

Earlier on Monday, Waller spoke, and the Atlanta Fed President Raphael Bostic, who has voting rights at FOMC meetings this year, also responded to the question of whether to cut interest rates this month. When asked if he supported a rate cut at this month's meeting, Bostic stated, "I will continue to keep my options open." He said he has not yet decided whether a rate cut is necessary at this month's FOMC meeting but believes interest rates should continue to be reduced in the upcoming months.

Bostic stated that the risks of the Federal Reserve achieving its dual mandate of employment and inflation have shifted, with the risks being roughly balanced, thus the mmf policy stance should be shifted to neutral.

Bostic commented on the economy, saying he does not believe that the process of the Federal Reserve making progress towards the 2% inflation target has stalled. Although the data has fluctuated, inflation continues to trend down toward the 2% target. The usa labor market is cooling but not deteriorating sharply, but decision-makers need to remain vigilant regarding the risks posed by inflation and employment. The Federal Reserve is waiting for a while to observe how the market or economy reacts to potential Trump policies.

Editor/Somer