Federal Reserve Governor Christopher Waller stated on Thursday that the Federal Reserve still needs to raise interest rates further to bring inflation back down to the 2% target, but these hikes do not need to occur at consecutive policy meetings. Officials can be flexible with the pace of tightening based on economic data. He anticipates that the 2027 dot plot might reflect rate hikes at the beginning of the year, followed by cuts. Waller believes that current inflation remains too high, and the expansion of AI infrastructure investment, along with ongoing energy shocks, could make inflationary pressures more persistent. Meanwhile, there is evidence that the U.S. economy is strengthening in the second half of 2026, with the labor market generally "robust and stable," providing room for continued tightening.