From BigGo Finance · BigGo Finance · · 1m 20s
Warsh: Fed Rate Decisions Data-Dependent
Fed Chair Warsh says October and December rate meetings will depend on economic data, not pre-set actions.
In brief
Fed Chair Warsh says October and December rate meetings will depend on economic data, not pre-set actions. Federal Reserve Chair Kevin Warsh stated October and December FOMC meetings will be data-driven with no pre-determined policy actions for the remainder of the year. Originally reported by BigGo Finance.
Warsh's October and December Meeting Stance
Federal Reserve Chair Kevin Warsh said October and December FOMC meetings will be decided based on economic, employment, and inflation data available at the time.
“FOMC conclusions will not be pre-determined, and I don't think we should be saying at this stage what actions the meetings for the rest of the year will take”
September CPI Data Release
September Consumer Price Index rose 3.7% year-over-year with core inflation exceeding expectations for a second consecutive month.
“Headline CPI rose 3.7% year-over-year, with core inflation exceeding market expectations for a second consecutive month”
Market Reaction to CPI Data
Futures market pricing briefly pushed October rate hike odds to 55% before settling back to around 40%.
“The breadth of price increases this time is quite wide, and the Fed will find it hard to ignore”
Fed's Structural Growth Phase
Warsh noted the U.S. is in a phase of structural growth with investment surge driven by policy support.
“The surge in investment is the most important development among global economic upside factors”
Dovish Officials' Reaction
Dovish officials felt like they'd taken a sip of cold coffee after seeing September CPI data.
“You could sense that the doves on the committee felt like they'd just taken a sip of cold coffee when they saw the September CPI numbers”
Market Strategy for October
Bank of America strategist Meghan Swiber said investors are waiting for Warsh to give green light on Fed rate continuation.
“investors are 'waiting for Warsh to give the green light on Thursday for the Fed to continue hiking'”
AI Impact on Economy
Warsh said AI improves economic efficiency but short-term employment impact remains uncertain.
“AI will transform the real economy, helping to improve economic efficiency and bolstering central banks' confidence in data and monetary policy”
October Meeting Uncertainty
October FOMC meeting has become a 'live meeting' with genuinely uncertain outcome.
“The October meeting has thus become a 'live meeting' with a genuinely uncertain outcome”
The main idea
Federal Reserve Chair Kevin Warsh stated October and December FOMC meetings will be data-driven with no pre-determined policy actions for the remainder of the year.
