Fed’s Waller Signals Caution On Rates, Sees Risk of Longer War

Federal Reserve Governor Christopher Waller said he is cautious about the need to lower interest rates in the near term, due to the energy shock triggered by war in Iran, and warned of the risk of a prolonged impact on inflation due to the conflict.

Waller mapped out two main scenarios on how the Iran war and its impact on energy and commodity prices will guide his approach to monetary policy, in a speech Friday.

In the first scenario, a re-opening of the Strait of Hormuz and a return of trade flows to normal would allow officials to look through ...