Kevin Warsh chaired his inaugural Federal Open Market Committee (FOMC) meeting as Chairman of the Federal Reserve on June 15, 2026. He faces significant challenges, including inflation roaring back at its fastest pace in three years and growing dissent among central bank policymakers. Investors are also dumping US Treasury bonds and betting that the Fed will need to raise rates by December, despite President Trump's calls for lower rates.
While the FOMC is widely expected to hold its benchmark rate steady this week in a range of $3.5% to $3.75%, Warsh's first press conference will be closely watched for clues about his future policy direction. Yields on two-year Treasuries have already jumped to over $4%, above the Fed's policy rate, and 30-year yields hit their highest since 2007 last month, signaling market expectations for higher rates. The FedWatch tool indicates a $99.6% probability of rates remaining unchanged at this week's meeting, but a $41.8% probability of a rate hike to $3.75% to $4% by December.
Warsh is taking over in the wake of an “unprecedented attack” on the central bank by the Trump administration, including an effort to remove governor Lisa Cook. Trump had previously lauded Warsh's independence but recently stated Warsh would be wrong to raise rates. Warsh, however, has pledged to shake up the central bank, advocating for closer cooperation with the Treasury Department, a change in how the Fed assesses inflation, and a reduction in the central bank's massive bond holdings, which could push up long-term rates by forcing markets to absorb more bonds. He must
