Waller urges immediate interest rate cuts as job market risks rise

In the United States, on July 17, 2025, Fed Governor Christopher Waller delivered a speech advocating for a reduction in interest rates. He outlined his concerns about the emerging risks facing the job market, emphasizing that private sector payroll growth is nearing a standstill. Waller's statements diverged from those of other Federal Open Market Committee members, who generally perceive the labor market as robust and prefer a cautious approach regarding interest rate changes. Waller noted that, despite the positive headlines associated with job growth, a more detailed examination reveals troubling trends, particularly in private employment figures. The governor warned that the seemingly positive employment numbers might be misleading, as they are likely to be revised downward. He pointed out that state and local government job gains have skewed the perception of overall job growth and that private sector gains were notably smaller. Moreover, Waller projected that the looming benchmark revisions expected in early 2026 would reveal an even bleaker picture regarding private payroll employment. While other FOMC members advocated for maintaining current rates, arguing that economic uncertainty remains too high to warrant a cut, Waller’s perspective reflects a sense of urgency regarding potential job losses. The speech came against a backdrop of increased calls from politicians, including former President Donald Trump, for lower rates. Trump criticized the Fed's chair for not taking more aggressive action in response to economic challenges. As the FOMC approaches its next meeting on July 30, Waller's position may lead to dissent among committee members if they decide to maintain the Federal Funds rate instead of cutting it, as he proposes. Waller's arguments could set the stage for a broader discussion on potential interest rate adjustments in the upcoming months, especially if further evidence supports his claims regarding job market vulnerabilities.