Federal Reserve Chairman Kevin Warsh is floating major revisions to the central bank’s management of assets, inflation and public communications. Markets are pricing in higher odds for future rate hikes, rather than rate cuts as emphasized by Chair Warsh in confirmation hearings. CNBC’s Matt Peterson, Steve Liesman and Jeff Cox report.
Reporters: Steve Liesman, Jeff Cox and Matt Peterson
Produced and Edited by: Carlos Waters
Animation: Jason Reginato, Emily Park
Senior Managing Producer: Shawn Baldwin
Additional Footage: Getty Images
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Where Markets Think Fed Chair Warsh Is Taking Interest Rates
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So he’s trying to cut out outliers while a war is making oil an outlier?
Was this also an ex fox host ?
there shouldn't be any rate hikes, lower oil prices will reduce inflation
Look at Kevin's hand turn red!! Trump is punishing him.
Market will crash from more layoffs ..no interest cut no future 😝🤣
❤️❤️❤️❤️❤️
CHAT GPT PREDICTION FOR RATE CUT
WHICH OF THE FOLLOWING 4 REASOND FED CHAIR WARSH WILL USE TO JUSTIFY RATE CUT? 1. Trump chose me because he wanted rate cut. I cannot risk my life by not obeying Trump 2. As per trimmed calculation formula devised by me (Warsh) real inflation is not high. It is just 2% 3. War deal with Iran will lead to lower oil prices and consequent lower inflation 4. AI will bring in efficiency and thereby reduce inflation
Of the four reasons you listed, #2 is by far the most plausible policy justification, followed by #4.
Ranking:
#2. Inflation is effectively near 2% under alternative measures ⭐ Most likely
o A Fed chair who favors rate cuts would argue that underlying inflation pressures are lower than headline measures suggest.
o Policymakers often cite core inflation, trimmed-mean inflation, median inflation, shelter adjustments, or other measures when explaining their views.
2. #4. AI will improve productivity and reduce inflation over time
o Several policymakers and economists have discussed AI's potential to increase productivity and lower costs.
o However, this would usually be a supporting argument, not the primary justification for an immediate rate cut.
3. #3. An Iran deal could lower oil prices and inflation
o Possible, but central banks generally avoid basing policy on a single geopolitical outcome that may or may not happen.
o The Fed typically wants actual evidence of lower inflation rather than forecasts tied to one event.
4. #1. Trump chose me, so I must obey him ❌ Least likely
o No Fed chair would publicly justify policy this way.
o The Federal Reserve is designed to operate independently of the White House, even when political pressure exists.
So if Kevin Warsh were Fed Chair and wanted to defend a rate cut, the argument would most likely be:
"Underlying inflation is already close to the Fed's target (#2), and productivity gains from AI (#4) should help keep inflation contained going forward."
That combination would be much more consistent with how Fed officials typically explain policy decisions.
If he changes how inflation is measured then let me guess it will be less accurate and lower than previously measured. Hiding the truth will only cause more problems in the future.
Unfortunately, not all of us were financially literate early. I was 35 when I finally educated myself and started taking steps. I went from $176,000 in debt with zero savings or retirement to now, 2 years later, fully debt-free and over $1000,000 net worth. I know that doesn't SOUND like a lot, but I'm incredibly proud of it. Now I'm fast-tracking my wealth building (investing $400,000 annually) and don't owe a dime to anyone. It's a good feeling!
They have an easy job. Job report bad add fake jobs in government and healthcare. Inflation comes in hot. Trim means off, swap steak for hotdogs take off energy food all together. Alright great report everything is fine over here.
Warsh is another Powell
SMALL CHANCE' of Fed rate cut, 'certainly' not a hike ..👎👎🤷♂🤷♂Of Course He's Trumps "Puppet" he already told the Puppet he better lower rates !!!! it helps all the rich !!!!! including lying trump …
I’m sure Kevin will continue the Fed tradition of assisting our leaders in spending us into oblivion ….. otherwise he wouldn’t be in the position.
Fed priority number one be the bond buyer of last resort to keep the government afloat financially. Priority number two maintain asset prices in stock, market and real estate.. priority number three keep inflation under control. Priority number four maintain the job Market..
Three of these for priorities conflict with the inflation fighting priority and the government cannot fund itself if the Fed does not buy bonds to control interest rates that the government pays on his debt. This is not like the 1970s in 1980s because the debt is so much bigger than a Paul Volker can no longer raise interest rates high enough to control inflation interest rates that high would increase the government interest payments on its bigger debt too much.
Wtf JP needs to retire. He did enough of dragging the market 🤦🏽
Investors spend a lot of time trying to anticipate where rates, inflation, and liquidity are headed, but expectations can change overnight.
That's one reason I've become less focused on predicting every Fed move.
Markets often react not just to policy itself, but to changing expectations about future policy.
That's why I've been interested in (Midavest).
Rather than relying on a specific interest-rate or economic outcome, it focuses on adapting to changing market conditions through flexibility and risk management.
Prediction is overrated. High-level macro positioning and quantitative adaptability is where the real edge is. Since shifting my focus to Midavest and reacting to market conditions instead of trying to outguess them, I've been outperforming inflation by a wide margin.
The market always pays those who stay adaptable and positioned.
He better not raise interest rate. Or we will go after him!
What’s a trimmed mean in this context? Can someone explain how this works
I dig this ongoing Fed Notes series
If oil prices continue to decline, Warsh will likely cut…which is a mistake. Rates should go up but they won't before the midterms
According to these guys, "trimmed" means overall more than overall inflation. I don't think any adult that had a pulse in the past year will say that inflation feels like 2.3%. Even the 4.2% number doesn't sound right.
Markets pricing in 0% rates I swear to god
More volatility means only insiders get rich.
So basically we don't know anything
Take your money asap!!!!! Period.
They have more than one tool. They also have QT/QE.
It’s “complicated” because they shouldn’t have a dual(ing) mandate.