Warsh Caught Between Trump and Bond Market Betting on Rate Hikes
View original at finance.yahoo.comWarsh Caught Between Trump and Bond Market Betting on Rate Hikes (Bloomberg) -- Just three weeks into the job, Federal Reserve Chairman Kevin Warsh is already facing an unusually high-stakes test…
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During his term as Fed governor, Warsh was a staunch hawk on monetary policy
60% confidenceThe Fed is widely expected to hold its benchmark rate steady in a range of 3.5% to 3.75% at this week's policy meeting
60% confidenceInflation is roaring back at the fastest pace in three years
60% confidenceKevin Warsh is in a very difficult position navigating conflicting pressures from the White House and bond markets
60% confidenceThe Federal Reserve was wrong to continue forecasting elevated inflation
60% confidenceArtificial intelligence will unleash a significant disinflationary force on the economy by increasing productivity
60% confidencePresident Trump has called on the Federal Reserve to lower interest rates
60% confidenceInvestors have been dumping US Treasury bonds and piling into bets that the Fed will need to start raising rates by December
60% confidenceIf Warsh delivers a convincing message that the Fed is willing to shift back into inflation-fighting mode, Wall Street will likely be reassured about his commitment to the bank's political independence; failure to do so will rattle already-worried markets
60% confidence