Ex-Fed Official Warsh Says Fed Won’t Move Before Jackson Hole


© Bloomberg. Kevin Warsh, former governor of the U.S. Federal Reserve, speaks during the American Economic Association (AEA) annual conference in Chicago, Illinois, U.S., on Friday, Jan. 6, 2017. Warsh said that more reform is needed at U.S. central bank than ever before.


(Bloomberg) — The Federal Reserve is unlikely to change its stance on interest rates or asset purchases before its meeting in Jackson Hole, Wyoming, in August, said former Federal Reserve Governor Kevin Warsh.

Getting the Fed to change their policies before Jackson Hole is a long putt from here, Warsh said, according to people familiar with his comments. He was participating in the Robin Hood Investors Conference Wednesday.

Warsh added that a rise in consumer prices won’t be enough to get the Fed to raise rates or taper purchases, but that a jump in employment numbers would more likely be the potential trigger.

When the Federal Reserve wraps up its meeting today, economists expect the so-called dot plot to point to an interest-rate increase in 2023, while the central bank is unlikely to signal a scaling back of bond purchases until later this year.

Warsh, who was interviewed by billionaire Stan Druckenmiller, said the Fed’s current view — that the recent spike in prices is transitory — is flawed because we won’t know if it’s correct until it’s too late.

Warsh’s perspective aligns with some other former Fed officials and prominent investors. Druckenmiller said in an interview on CNBC last week that the Federal Reserve has lulled investors into a false sense of security and distorted asset prices.

See also  Senate Confirms Janet L. Yellen as Treasury Secretary

Read More: U.S. Inflation Isn’t Scary Yet, But It Could Be: Bill Dudley

Paul Tudor Jones said in an interview on the network earlier this week that from an economic standpoint, things are “bat s crazy.” The Fed is focused on unemployment, juicing an already hot economy, even as inflation and financial stability are growing concerns, he said.

Warsh is currently a visiting fellow in economics at Stanford University’s Hoover Institution. He served on the Fed’s board of governors from 2006 to 2011.

Robin Hood, which is hosting the investment conference, has been fighting poverty in New York City since 1988, and has awarded grants of $3 billion during that time.

©2021 Bloomberg L.P.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

See also  Cyber Monday 2020: The best deals you can get at Best Buy on TVs, appliances and more



Please enter your comment!
Please enter your name here