💡 Fed Chair Warsh remains hawkish and focused on bringing price stability 🖱️ Fed keeps interest rates

💡 Fed Chair Warsh remains hawkish and focused on bringing price stability

🖱️ Fed keeps interest rates steady at 3.75-4%.

🖱️ Inflation remains elevated above the 2% target for over 6 years.

🖱️ Geopolitical uncertainty is the primary reason for rising inflation.

🖱️ Economic activity is expanding and the labour market remains strong.

🖱️ In 2027, the FOMC schedule will change, with the same 8 Fed meetings annually, but one meeting will focus only on monetary policy strategy without any rate decision.

🖱️ In 2028, the Fed will have two such monetary policy strategy meetings and six on rate decisions.

🖱️ Warsh says it is important to keep ‘time and space’ for such ‘strategic deliberations’ to focus on the ‘long-term horizon.’

🖱️ On December rate hikes, Warsh says the coming period is ‘information rich’ and future hikes will depend on it.

🖱️ Warsh says he is ‘unwilling and unable’ to call financial conditions tight.

🖱️ Warsh believes higher interest rates do affect AI spending, irrespective of revenues.

🖱️ Warsh clarified that ‘politics’ or ‘midterm elections’ had no role in today’s decision about Fed rates.

🖱️ Any decision on shrinking the Fed balance sheet will only come early in Q1 2027, after recommendations from a task force.

🖱️ Overall, he doesn’t see current economic growth causing inflation but is closely watching the numbers for the future.

✔️ @venture