Federal Reserve is expected to raise its benchmark rate, defying President Trump's demands
- Federal Reserve Chairman Kevin Warsh will announce the central bank's policy decision on Wednesday, with markets heavily betting on a 0.25 percentage point rate hike to a 3.75%-4.00% range.
- Surging oil prices above $100 and August payrolls increasing by 162,000 have pressured the Fed, as inflation remains 140 basis points above the 2% target. This reverses 2026 expectations of rate cuts.
- Markets now assign 90.7% probability to the hike, while producer prices rose 5.4% over the prior year and headline inflation increased 3.4% year over year. Core CPI rose 2.4%.
- President Donald Trump's Republican party defends slim congressional majorities before November elections, adding political sensitivity to Warsh's decision despite Trump's earlier expectation that the Fed chair would cut rates.
- Economists expect the Fed to signal further tightening ahead, as Chairman Warsh attempts to maintain institutional credibility by walking a 'fine line' in his post-meeting remarks without providing forward guidance.
236 Articles
236 Articles
Warsh Is in a Tight Spot Ahead of Fed Decision
Barely four months into the job, Federal Reserve Chair Kevin Warsh is stuck between two strong and opposing forces: Financial markets that anticipate the central bank will raise interest rates, and President Trump, who wants the Fed to cut them or leave them unchanged. Economists expect that on Wednesday, Warsaw...
Inflation returns to rise again and the new president of the Fed is ready for the first increase in rates for over three years. But that doesn't like Trump because it would make more expensive credit to families
Federal Reserve Chairman Kevin Warsh is under intense pressure. If he raises interest rates tonight, Donald Trump will be angry. If he doesn't, the US economy risks falling into a crisis of confidence.
Fed Interest Rate Decision: The US stock market is expected to see a sharp decline as the US Federal Reserve may raise interest rates. If this increase does not occur, the market may trade flat or even bullish.
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Bias Distribution
- 49% of the sources are Center
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