Waller: Core Inflation Pressures Are Alarming, AI Investment Is Driving Up Prices
2026.07.14 00:46:41
Fed Governor Christopher Waller stated that if the core inflation data released this week remains elevated, the Federal Reserve will need to consider raising interest rates in the near term. Waller expressed concern about the recent rise in core inflation, citing tariffs, higher energy prices, and demand for artificial intelligence (AI) investments as key factors driving inflation up. He projected that overall inflation will begin to slow this week, but core inflation will remain a key metric to monitor. However, Waller also noted that if core inflation continues to fall, holding interest rates steady would still be a reasonable choice. He reaffirmed the Fed’s commitment to restoring inflation to its 2% target while avoiding excessive policy tightening that could trigger a recession. Additionally, Waller noted that the U.S. labor market remains solid, near the Fed’s maximum employment goal, with consumer spending and business investment staying strong, and AI-related investment is expected to continue growing.
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