Hawkish Expectations
Kevin Warsh, the new Fed Chair, explicitly stated the Fed would no longer provide ‘forward guidance’. Nevertheless, pundits reported that Warsh signaled future rate hikes. Similarly, but not necessarily an endorsement of pundits, markets have priced in a single ¼ point rate increase by year-end. Expectations for the policy rate at year-end are now nearly a full percentage point higher than they were four months ago, despite fading tariff impacts and retreating oil prices. Compare: As of 2/26/2026 – days…

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