Traders See Warsh Holding or Hiking Rates After 3.8% CPI, 6% PPI
Updated
Updated · Fortune · May 14
Traders See Warsh Holding or Hiking Rates After 3.8% CPI, 6% PPI
6 articles · Updated · Fortune · May 14
Fed funds futures now imply a near-certainty the Federal Reserve will stay on hold until September, with markets increasingly leaning toward a later rate hike rather than any cut.
April inflation reset those bets: consumer prices rose 3.8% and producer prices 6%, both above expectations, while the Iran war added to pressure on the outlook.
Kalshi shows 31% odds of a year-end hike, and the 30-year Treasury risk premium moved above 5% for the first time since 2007, signaling investors expect higher rates ahead.
That leaves new Fed Chair Kevin Warsh boxed in: analysts reviewed by Fortune largely see his first move as hold-or-hike, not the cut President Trump had wanted.
Is the Fed risking a recession by signaling rate hikes while the labor market shows signs of cooling?
How will new Fed Chair Kevin Warsh unify a fractured committee to tackle five years of runaway inflation?
Beyond rate hikes, could stablecoin growth be the real key to understanding future monetary policy?
Fed Poised to End Easing Bias: June 2026 FOMC Meeting Signals Shift Toward Tightening Amid Persistent Inflation and Leadership Change
Overview
The June 2026 FOMC meeting is set to mark a major turning point for the Federal Reserve’s monetary policy. The Fed is expected to abandon its long-standing easing bias, moving away from a focus on interest rate cuts. This shift is driven by persistent inflation, with key measures like CPI and PCE staying above the 2% target, and a resilient labor market where unemployment remains low. As a result, most FOMC members are likely to adopt a tightening bias by year-end, signaling a more hawkish stance that will have immediate effects on financial markets and the broader economy.