Fed holds fire as Warsh telegraphs more hikes without saying it
Warsh used his assessment of a strong economy and warnings over persistent inflation to signal the Fed's job is not yet done.
Federal Reserve Chairman Kevin Warsh signaled on Wednesday that the central bank would likely raise interest rates one more time this year, despite his pledge not to provide any explicit guidance on the future direction of monetary policy. Emphasizing a robust economy and ongoing concerns about inflation, Warsh indicated that the Fed's work is far from complete.
The statement reinforced the expectation that policymakers will increase borrowing costs in December, with the possibility of another hike early in 2027. However, Warsh carefully refrained from committing to the magnitude of additional tightening, expressing that more may not be necessary, according to Vincent Reinhart, chief economist at BNY Investments.
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