Christopher Waller Warns of Threats to Fed Independence

Federal Reserve Governor Christopher Waller stated at Bloomberg's New Economy Forum in New Delhi that rising long-term U.S. Treasury yields are assisting tighter monetary policy by curbing demand in interest-rate-sensitive sectors such as housing and automobiles. Waller noted that while this was not the primary intention of the Federal Reserve, the yields are doing some of the work. He also predicted that massive investments in artificial intelligence infrastructure will continue to drive up semiconductor prices for two to three years.

Waller also addressed political pressure on the central bank from President Donald Trump, who has pushed for lower interest rates and attempted to remove officials. This tension is highlighted by a recent White House committee formation to investigate mortgage fraud allegations against Federal Reserve Governor Lisa Cook. Cook faces a hearing on November 5 and has described the allegations as a bogus effort to justify her removal.

The administration's efforts to oust Cook follow a previous attempt that was blocked by the Supreme Court of the United States.