WS #16477
Federal Reserve Chair Warsh has delivered a sharply hawkish press conference, explicitly stating that inflation remains too high and that the central bank removed a dose of accommodation in September. Market pricing has rapidly adjusted, with December rate hike probabilities jumping to 90% and 5-year Treasury yields testing 4.90%. Warsh also announced a structural change to the FOMC calendar, reducing policy-setting meetings to six per year by 2028 to allow for deeper strategic deliberation. This marks a decisive escalation in the 'higher for longer' narrative, pressuring growth stocks and bond prices while benefiting financials and the dollar.
Fed Hawkish Pivot and Rate Hike Odds
Federal Reserve Chair Warsh has delivered a sharply hawkish press conference, explicitly stating that inflation remains too high and that the central bank removed a dose of accommodation in September. Market pricing has rapidly adjusted, with December rate hike probabilities jumping to 90% and 5-year Treasury yields testing 4.90%. Warsh also announced a structural change to the FOMC calendar, reducing policy-setting meetings to six per year by 2028 to allow for deeper strategic deliberation. This marks a decisive escalation in the 'higher for longer' narrative, pressuring growth stocks and bond prices while benefiting financials and the dollar.