Kevin Warsh’s first policy meeting as Federal Reserve chair is being met with a sharp repricing in markets, where traders now assign a meaningful probability to an interest-rate increase rather than a cut, as inflation proves stickier than expected.
Kevin Warsh’s first policy meeting as Federal Reserve chair is being met with a sharp repricing in markets, where traders now assign a meaningful probability to an interest-rate increase rather than a cut, as inflation proves stickier than expected.
Watching this repricing has a familiar ring to it — 2018, when Powell took over with markets already baking in hike after hike, and by the end of the year he was walking it all back. When traders front-run a new chair this aggressively, it usually says more about their own nerves than about anything the Fed intends to do.