A quieter Fed chief means others narrate the story
Federal Reserve chairman Kevin Warsh testified before Congress over two days last week, totaling more than five hours. Yet it was comments from several of his colleagues that gave the clearest picture of what the central bank is likely to do at next week's policy meeting.Why it matters: It is a central paradox of Warsh's communications strategy.
Reported by 1 outlet — Axios. See all sources ↓
Federal Reserve chairman Kevin Warsh testified before Congress over two days last week, totaling more than five hours. Yet it was comments from several of his colleagues that gave the clearest picture of what the central bank is likely to do at next week's policy meeting.Why it matters: It is a central paradox of Warsh's communications strategy. He is determined to get out of the business of giving markets and the public much guidance on future policy, which means the markets fill in the gaps based on comments from other officials.That isn't necessarily a bad thing — it preserves flexibility on interest rate policy that was diminished when former Fed chiefs all but preannounced upcoming rate moves.But it also means that Warsh has ceded some of the power to set expectations, which raises the risk of more surprise and volatility around future actions.State of play: The central bank's policy committee meets next week, and Warsh declined to offer much in the way of guidance on what it will do, instead promising a "family fight" that seeks to arrive at the best decision.Other officials were a little more specific. Fed governor Christopher Waller, speaking on July 13, said that incoming June inflation data could tilt him toward favoring a near-term rate hike.
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- Federal Reserve chairman Kevin Warsh testified before Congress over two days last week, totaling more than five hours. Yet it was comments from several of his colleagues that gave the clearest picture of what the central bank is likely to do at next week's policy meeting.Why it matters: It is a central paradox of Warsh's communications strategy.
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- 13m ago.
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A quieter Fed chief means others narrate the story
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