- In today’s CEO Daily: Diane Brady breaks down new comments from Fed governor Christopher Waller.
- The big story: BP hires Big Oil’s first female CEO, its fourth chief in six years.
- The markets: Up in Europe, down in Asia.
- Plus: All the news and watercooler chat from Fortune.
Good morning. I was at the Yale CEO Summit yesterday in New York, hosted by Jeffrey Sonnenfeld, senior associate dean of the Yale School of Management and longtime Fortune contributor. Much of the conversation focused on navigating a volatile business landscape and an administration that gets laurels for its pro-business policies and darts for how it deals with allies and anyone who speaks out against Trump or his policies. As always, Sonnenfeld kept it off the record to, as he put it, “tap into problem-solving instead of name-calling” and let divisive issues “be discussed constructively, free of grandstanding, ideological clichés, and tribal loyalty.”
What was on the record: a conversation between CNBC’s Steve Liesman and Fed governor Christopher Waller, a contender to replace Jerome Powell as chairman of the Federal Reserve, alongside frontrunners Kevin Warsh and Kevin Hassett. (In a spot poll, 81% of people in the room supported Waller taking the role, but just 36% predicted he would get the job.)
The conversation came at a time of weak job data and growing speculation about rate cuts, along with data showing a K-shaped economy in which wealthy Americans feel flush while their poorer brethren struggle with higher prices and slower wage growth. (The Fed cut rates for a third straight meeting earlier this month to support a softening labor market.)
Some of Waller’s comments that stood out for me:
On future rate cuts: “We’re still about 50 to 100 basis points above neutral,” said Waller, who argued for a rate closer to 3%. “We’re close to zero job growth. That’s not a healthy job market. AI is stalling hiring; there’s not going to be any reacceleration of inflation.” That said, “because inflation is still up, we can take time to steadily bring the rate down towards neutral.”
On central bank independence: “If there’s something pressing, I know in the past, Fed chairs have talked to the president. COVID is an example where you wanted a coordinated response. The Fed chair and the secretary of Treasury have breakfast every two weeks; that’s a typical channel of communication. I spent 20 years of my life working on central bank independence. The other side is accountability: We want central bank independence, but we still want to be accountable to the American public.”
On the growth outlook: Waller estimates 1.6% growth for 2025, largely due to a negative first quarter. He predicts a stronger picture for 2026, where “there will be some stimulus effects, productivity effects, a waning of tariff effects [which he thinks will settle at a 10-11% effective rate]. All of that is pro-growth, pro-U.S., inflation easing.”
On stablecoins: “If you want competition in the payment space, go to stablecoins. These are very fast and efficient ways to move money across the globe. I want an even playing field… We have to get off this crypto-is-an-evil-thing mentality; you have to understand all these technologies … This is going to strengthen the U.S. dollar.”
Contact CEO Daily via Diane Brady at diane.brady@fortune.com
