By Michael S. Derby NEW YORK (Reuters) -Federal Reserve Governor Christopher Waller said on Thursday he continues to believe that the U.S. central bank should cut its interest rate target at the end of the month amid mounting risks to the economy and the strong likelihood that tariff-induced inflation will not drive a persistent rise in price pressures.

A Federal Reserve governor seen as a candidate to succeed Chair Jerome Powell laid out his strongest case yet for a rate cut this month, aligning himself with President Trump's demands that the central bank lower interest rates.

The Bureau of Labor Statistics reported that the consumer price index (CPI), a popular inflation gauge, increased in June to 2.7% on an annual basis as prices rose for consumers.

The inflation gauge the Federal Reserve relies on most to decide whether to raise or lower U.S. interest rates is likely to cement a decision by the central bank to stand pat at its next meeting at the end of July.

With June's inflation reading coming in hotter than the month prior, the Fed is under renewed pressure to maintain its current target range for the federal funds rate. Analysts now see little chance of a rate cut in the near term. That means HELOC borrowers are unlikely to see significant rate drops anytime soon.

“It’s by now widely agreed, almost all over the world: If you leave monetary policy in political hands, you’ll get too much inflation,” Alan Blinder, a professor of economics at Princeton University and former vice chairman of the Federal Reserve, told ABC News.

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The producer price index for total final demand was unchanged in June, the Bureau of Labor Statistics reported.