"Federal Reserve Governor Chris Waller said Friday he had a "great interview" to potentially succeed Jerome Powell as chair of the central bank, while warning the U.S. labor market is so weak it may actually be contracting. Speaking in an interview with Steve Liesman of CNBC's Squawk Box, Waller described his job interview for chairman position, a formal process confirmed by Treasury Secretary Scott Bessent in July, as "just serious economic discussion.""
"Waller, who has been a Fed governor since 2020, said "there was nothing political about it," an indirect response to accusations of the Fed's independence being undermined during the second Trump administration. He said they talked about various aspects of the Fed, various speeches Waller has given, and his viewpoints on various subjects. Then, Waller held forth on the economy and the sputtering labor market."
"He said it's "not doing great," that it's "weak" and appeared to surprise Liesman by saying he wouldn't be surprised if job growth had turned negative. With official government statistics now delayed due the government shutdown, Waller said he and other members of the Fed have been relying more heavily on private-sector data and anecdotal reports from businesses to gauge employment dynamics."
"The data isn't as representative or broad as the official government data, but they're "all telling you the same story" about the weak labor market, he said. "Job growth has probably been negative the last few months," he said, prompting Liesman to respond, "wow." Waller argued the Fed is not fulfilling the maximum employment half of its dual mandate: "If you have negative job growth, that's not maximum employment where you're shrinking y"
The job interview for the Federal Reserve chair position was confirmed as a formal process by Treasury Secretary Scott Bessent. The interview was a serious economic discussion and nonpolitical. The economic outlook is dominated by concerns about a faltering labor market that appears weak and may be contracting. Official government employment statistics are delayed by a government shutdown, prompting greater reliance on private-sector data and business anecdotes. Those alternative indicators point to consistent weakening and suggest job growth has likely been negative in recent months. Negative job growth would mean the Federal Reserve is not meeting the maximum employment half of its dual mandate.
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