New Fed Chair Warsh Faces Pressure For Immediate Hike | WION World Business Watch

Added: 2026-05-25

[00:00:00]And now, let's put the spotlight on macros. Financial market bets directly contradict what President Donald Trump spent the last year demanding. Interest rate futures are flashing a startling signal. The base case among traders now shows incoming Federal Reserve chair Kevin Warsh hiking rates as his very first policy move.

[00:00:23]Not rate cuts or pause, but a hike.

[00:00:26]For well over a year, Trump has threatened to fire Jerome Powell. His reason, Powell refused to cut interest rates aggressively.

[00:00:35]Trump called rate cuts a requirement for whoever replaced Powell.

[00:00:40]He openly demanded rates as low as 1%.

[00:00:44]Trump made his position crystal clear.

[00:00:46]The next Fed chair must be a dove.

[00:00:50]But, he may have picked a hawk instead.

[00:00:53]Investors are actively trading a rate hike in the futures market. And right now, bets show rate hikes are coming under Warsh.

[00:01:01]Kevin Warsh is a former Fed governor.

[00:01:03]He's known for hawkish instincts.

[00:01:06]Warsh's appointment signals something Trump may not have fully anticipated. An independent thinker at the Fed's helm.

[00:01:14]Inflation has remained stubborn. Fiscal spending continues to balloon. And in this environment, a credible central banker might feel compelled to raise rates, not lower them.

[00:01:26]But, Trump wants lower rates. He wanted a loyal Fed chair. He may have gotten neither.

[00:01:33]Markets are now pricing in a policy direction that stands at direct opposition to everything Trump has publicly demanded over the past year.

[00:01:41]Will Warsh actually raise rates? Nobody knows for certain.

[00:01:46]But, the market thinks he just might.