A Less Friendly Fed Is Bad News For Markets

Kevin Warsh’s Senate testimony points to a possible shift toward a less communicative Federal Reserve, reducing forward guidance to markets. That would likely increase uncertainty around the policy path and could raise volatility in rates and risk assets even without an immediate change in the fed funds rate.

Analysis

Kevin Warsh’s Senate testimony points to a possible shift toward a less communicative Federal Reserve, reducing forward guidance to markets. That would likely increase uncertainty around the policy path and could raise volatility in rates and risk assets even without an immediate change in the fed funds rate.