Warsh Opens Door to September Rate Hike as Market Odds Jump to 60%
Updated
Updated · Yahoo Finance · Aug 29
Warsh Opens Door to September Rate Hike as Market Odds Jump to 60%
3 articles · Updated · Yahoo Finance · Aug 29
Summary
September hike odds rose to 60% from 35% after Fed Chair Kevin Warsh signaled at Jackson Hole that rates could rise if inflation data fails to improve.
Warsh’s message clarified how the Fed would respond to persistent price pressures after his July press conference left markets doubting whether it had a credible anti-inflation strategy.
Ken Rogoff said the speech showed Fed independence in the face of pressure from President Trump and Treasury Secretary Scott Bessent, but warned a September move could trigger fierce political backlash before midterms.
Bond yields are expected to keep climbing, with Rogoff predicting the 10-year Treasury yield will be higher a year from now as investors absorb a firmer inflation stance.