Fed's Waller: Rate cuts could come from rising unemployment

Federal Reserve (Fed) Governor Christopher Waller told Bloomberg on Thursday that tariffs are a part of most economic debates and noted that the general tone suggests that many companies are frozen by the uncertainty.

Key takeaways

"Firms are trying to see how to navigate tariffs."

"Wouldn't surprise me to see more layoffs, higher unemployment."

"Smaller tariffs will have modest pass through."

"We need better control of budget deficit."

"No obvious reason why tariffs should be off table as part of fiscal debate."

"Not likely by July there will be clear tariff impacts yet."

"Easiest place to offset tariff costs is by cutting payrolls."

"It's possible tariffs could push up unemployment quickly."

"Struggle over last 18 months has been uneven inflation progress."

"I still strongly believe tariffs will be one time price level effect."

"Demand slowdown from tariffs would offset some inflation impact."

"It's going to take courage to stare down tariff price increases and see them as transitory."

"I'm willing to look through tariff price increases."

"Rate cuts could come from rising unemployment."

"Fed will look at data to determine policy moves."

"Data focus brings risk of being late on policy action."

Market reaction

The US Dollar Index struggles to gain traction following these comments. At the time of press, the index was down 0.45% on the day at 99.30.