Recent data suggesting a slowdown in the economy and continuing moderation in inflation means U.S. Federal Reserve policy is in the right spot, said Fed Governor Chris Waller, speaking at an event in Washington, D.C.

"Something appears to be giving, and it's the pace of the economy," said Waller, noting October data and current forecasts for the rest of the fourth quarter as indicating an easing in activity. Inflation data, he said is also moving in the right direction.

Taking questions after his prepared remarks, Waller also said that if inflation were to continue to decline, there's a good argument to be made for rate cuts within a few months.

Waller is rated the third-most hawkish member of the Federal Open Market Committee (FOMC) by InTouch Capital Markets, so any dovish lean by him is of notable import.

Already higher on the session, the price of bitcoin [BTC] rallied more than another 1% on the heels of Waller's comments, even as his colleague Michelle Bowman – speaking at another event – said she believes rates will have to move higher to bring inflation to heel. At press time, bitcoin was changing hands at $37,700.

Traditional markets are also taking note, with the 10-year Treasury yield down four basis points to 4.35%, the dollar index lower by 0.4% and gold ahead 1.3% to $2,038 per ounce.

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Stephen Alpher

Stephen is CoinDesk's managing editor for Markets. He previously served as managing editor at Seeking Alpha. A native of suburban Washington, D.C., Stephen went to the University of Pennsylvania's Wharton School, majoring in finance. He holds BTC above CoinDesk’s disclosure threshold of $1,000.