Warsh Refuses October Rate Signal in Bangkok — SkimNews
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- Kevin Warsh refused to signal whether the Fed will hike at its Oct. 27-28 meeting in Bangkok, saying "I don't prejudge meetings" and calling the end of forward guidance "a new chapter at the Fed" where "we're not in that business anymore."
- Warsh described global monetary policy as a "synchronous tightening" with "no free riders," saying central banks made their own choices under their own mandates but the result was coordinated.
- Warsh called AI "probably the most consequential change to the U.S. and the global economy in my lifetime" but warned the path there may be "very bumpy" and its near-term effect on jobs remains uncertain.
- The Fed raised rates to 3.75%-4% last month — its first hike since 2023 — with traders pricing a 72.3% chance of no change at October's meeting per CME Fed Watch, while the majority still expect a 25-basis-point hike in December.
- Asian stock indexes and Treasury yields were largely stable following Warsh's Friday remarks at the fireside chat with IMF managing director Kristalina Georgieva.
Why it matters: Warsh's refusal to pre-signal keeps October's decision fully data-dependent, and with traders pricing 72.3% odds of no change, a hike at that meeting would land directly against consensus positioning built during the forward-guidance era that Warsh just declared over.
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