Waller Opened the Door to a Half-Point Hike. Fixed Loans Did Not Move.

Federal Reserve Governor Christopher Waller said on Tuesday, Nov. 10, that he is leaning toward a December rate increase and would consider a half-point move if inflation runs hotter than expected. That half-point case is a comment, not a decision, and no existing fixed loan was reset. The Fed’s target range remains 3.75% to 4%.

Speaking at a Bank of England event, Waller said a quarter-point increase would be enough if price pressures improved as expected. If core inflation, excluding food and energy, rose 0.3% or more, he said raising rates by only 25 basis points would put the Fed’s credibility at risk. October’s price report had not been released when he spoke, so the larger step is conditional. CNBC said markets had already largely priced a quarter-point December move.

Treasury yields rose the same morning. CNBC reported the 2-year yield up more than 7 basis points to 4.62%, and the 10-year up more than 3 basis points to 4.894%. Those benchmarks can affect a new mortgage or car loan only if a lender changes its offer. They do not rewrite a fixed contract already signed.

Waller’s published remarks also cited 3.4% third-quarter growth, 4.1% October unemployment, and a gain of 165,000 jobs.

Could Waller’s remarks raise a fixed loan payment you already have? No. He set out a possible December increase, and a larger one only if inflation disappoints. The Fed has not voted, and no existing fixed payment was changed.