Kevin Warsh to Be Sworn In as Fed Chair on May 22; Markets Price in June Rate Hold
Summary
- Markets see limited odds of a near-term interest-rate cut even as Kevin Warsh takes office as Fed chair.
- According to CME FedWatch, the probability of a benchmark rate hold at the June FOMC meeting stands at 96.8%%, while the odds of a 25-basis-point rate hike are 3.2%%.
- Middle East risks, rising oil prices, the possibility of renewed inflation pressures and Warsh’s hawkish stance are seen constraining expectations for early Fed easing.
Forecast Trend Report by Period
Kevin Warsh, President Donald Trump’s nominee to lead the Federal Reserve, will be officially sworn in as Fed chair on the night of May 22. Even with the change in leadership, markets are assigning little chance to a near-term interest-rate cut.
Crypto-focused media outlet BlockBeats reported on May 22 that the White House scheduled Warsh’s swearing-in ceremony for 11 a.m. on May 22 in Washington, or 11 p.m. in South Korea. Trump will preside over the ceremony.
Investors are also focused on how monetary policy may develop under Warsh. CME FedWatch data show markets are pricing in a 96.8% chance that the Federal Open Market Committee will leave its benchmark rate unchanged at its June meeting.
The probability of a 25-basis-point rate increase stands at 3.2%. A rate cut is effectively not being priced in.
Market participants have pointed to rising Middle East risks, higher oil prices and the possibility of renewed inflation pressures as factors limiting expectations for early Fed easing. Warsh is also viewed as relatively hawkish, prompting discussion that the Fed’s policy stance could shift.
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.
