Fed's Waller says safety premium for Treasuries is gone, pushing neutral rate higher

Fed Governor Waller said the safety premium for U.S. Treasuries has largely disappeared, which is pushing his estimate of the neutral interest rate higher and implying rates may stay elevated longer. He warned that U.S. structural deficits would need to come closer to zero percent of GDP, down from around 6% currently, to grow out of the $40 trillion debt load. Waller indicated he favours keeping rates steady if inflation pressures continue cooling, pushing the benchmark 10-year Treasury yield down to 4.74% from 4.818%.