Fears of elevated interest rates dampened the mood on Wall Street at the start of this year–but cooling core inflation and dovish comments by Federal Reserve governor Christopher Waller have given investors reason to feel a bit more cheerful this week.

The US Federal Reserve could cut rates three or four times this year if inflation data cooperates, with a first cut possible before July, a senior bank official said Thursday.

With the Federal Reserve touting a slower pace of easing, markets are expecting a longer pause. But Gov. Christopher Waller said the next interest rate reduction could come as soon as March because of inflation data.

Federal Reserve Governor Christopher Waller doubled down on more rate cuts and cooling inflation following higher price projections from the central bank and growing expectations among investors ...

At its December meeting, the FOMC lowered the federal funds rate to a range of 4.25% to 4.5%. Committee members also adjusted their median projection rate for the end of 2025 to 3.9%, up from a projected 3.4% in September.

A top policymaker at the US Federal Reserve says that he still supports reducing interest rates this year, despite elevated inflation and the prospect of widespread tariffs.

Stocks struggled to make headway after a solid rally, while bond yields dropped on dovish remarks from Federal Reserve Governor Christopher Waller.

By Howard Schneider, Ann Saphir WASHINGTON (Reuters) -Inflation is likely to continue to ease and possibly allow the U.S. central bank to cut interest rates sooner and faster than expected, Federal Reserve Governor Christopher Waller said on Thursday in comments that pushed against recent market moves that anticipate a shallower Fed rate path.

Donald Trump is expected to elevate Michelle Bowman, a fifth-generation community banker and current Fed governor, as the government’s most influential banking regulator.

Treasury yields were little changed on Friday after sharply falling earlier in the week, as investors assess the U.S. inflation outlook. The 10-year Treasury was up one basis point at 4.617%. The 2-year Treasury yield inched up 4 basis points at 4.

The Federal Reserve has withdrawn from the Network of Central Banks and Supervisors for Greening the Financial System, a global coalition of central banks engaged in the study of climate risk that was launched in 2017.